Should You Be Concerned With Jay Bharat Maruti Limited's (NSE:JAYBARMARU) -11% Earnings Drop?
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Examining Jay Bharat Maruti Limited's (NSE:JAYBARMARU) past track record of performance is an insightful exercise for investors. It allows us to reflect on whether or not the company has met or exceed expectations, which is a great indicator for future performance. Today I will assess JAYBARMARU's latest performance announced on 31 March 2019 and compare these figures to its longer term trend and industry movements.
View our latest analysis for Jay Bharat Maruti
Was JAYBARMARU's recent earnings decline worse than the long-term trend and the industry?
JAYBARMARU's trailing twelve-month earnings (from 31 March 2019) of ₹522m has declined by -11% compared to the previous year.
Furthermore, this one-year growth rate has been lower than its average earnings growth rate over the past 5 years of 20%, indicating the rate at which JAYBARMARU is growing has slowed down. Why is this? Well, let’s take a look at what’s going on with margins and whether the rest of the industry is experiencing the hit as well.
In terms of returns from investment, Jay Bharat Maruti has fallen short of achieving a 20% return on equity (ROE), recording 13% instead. Furthermore, its return on assets (ROA) of 7.2% is below the IN Auto Components industry of 7.9%, indicating Jay Bharat Maruti's are utilized less efficiently. And finally, its return on capital (ROC), which also accounts for Jay Bharat Maruti’s debt level, has declined over the past 3 years from 23% to 14%.
What does this mean?
While past data is useful, it doesn’t tell the whole story. Companies that are profitable, but have volatile earnings, can have many factors impacting its business. You should continue to research Jay Bharat Maruti to get a more holistic view of the stock by looking at:
Future Outlook: What are well-informed industry analysts predicting for JAYBARMARU’s future growth? Take a look at our free research report of analyst consensus for JAYBARMARU’s outlook.
Financial Health: Are JAYBARMARU’s operations financially sustainable? Balance sheets can be hard to analyze, which is why we’ve done it for you. Check out our financial health checks here.
Other High-Performing Stocks: Are there other stocks that provide better prospects with proven track records? Explore our free list of these great stocks here.
NB: Figures in this article are calculated using data from the trailing twelve months from 31 March 2019. This may not be consistent with full year annual report figures.
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.
If you spot an error that warrants correction, please contact the editor at editorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading.
