Does Astral Poly Technik Limited's (NSE:ASTRAL) 12% Earnings Growth Make It An Outperformer?
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After looking at Astral Poly Technik Limited's (NSE:ASTRAL) latest earnings update (31 March 2019), I found it helpful to revisit the company's performance in the past couple of years and compare this against the latest numbers. As a long-term investor I tend to focus on earnings trend, rather than a single number at one point in time. Also, comparing it against an industry benchmark to understand whether it outperformed, or is simply riding an industry wave, is an important aspect. In this article I briefly touch on my key findings.
See our latest analysis for Astral Poly Technik
How Did ASTRAL's Recent Performance Stack Up Against Its Past?
ASTRAL's trailing twelve-month earnings (from 31 March 2019) of ₹2.0b has jumped 12% compared to the previous year.
However, this one-year growth rate has been lower than its average earnings growth rate over the past 5 years of 24%, indicating the rate at which ASTRAL is growing has slowed down. What could be happening here? Well, let's examine what's going on with margins and whether the whole industry is feeling the heat.
In terms of returns from investment, Astral Poly Technik has fallen short of achieving a 20% return on equity (ROE), recording 15% instead. However, its return on assets (ROA) of 10% exceeds the IN Building industry of 6.6%, indicating Astral Poly Technik has used its assets more efficiently. And finally, its return on capital (ROC), which also accounts for Astral Poly Technik’s debt level, has increased over the past 3 years from 19% to 20%. This correlates with a decrease in debt holding, with debt-to-equity ratio declining from 45% to 21% over the past 5 years.
What does this mean?
While past data is useful, it doesn’t tell the whole story. Positive growth and profitability are what investors like to see in a company’s track record, but how do we properly assess sustainability? You should continue to research Astral Poly Technik to get a better picture of the stock by looking at:
Future Outlook: What are well-informed industry analysts predicting for ASTRAL’s future growth? Take a look at our free research report of analyst consensus for ASTRAL’s outlook.
Financial Health: Are ASTRAL’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.
