Should You Be Happy With Gyldendal A/S's (CPH:GYLD B) Performance Lately?
When Gyldendal A/S (CPSE:GYLD B) announced its most recent earnings (30 June 2019), I did two things: looked at its past earnings track record, then look at what is happening in the industry. Understanding how Gyldendal performed requires a benchmark rather than trying to assess a standalone number at one point in time. Below is a quick commentary on how I see GYLD B has performed.
Check out our latest analysis for Gyldendal
Did GYLD B's recent earnings growth beat the long-term trend and the industry?
GYLD B's trailing twelve-month earnings (from 30 June 2019) of ø21m has declined by -1.5% 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 GYLD B is growing has slowed down. Why is this? Let's examine what's occurring with margins and if the entire industry is experiencing the hit as well.
In terms of returns from investment, Gyldendal has fallen short of achieving a 20% return on equity (ROE), recording 5.9% instead. Furthermore, its return on assets (ROA) of 3.2% is below the DK Media industry of 4.6%, indicating Gyldendal's are utilized less efficiently. And finally, its return on capital (ROC), which also accounts for Gyldendal’s debt level, has declined over the past 3 years from 15% to 7.4%. This correlates with an increase in debt holding, with debt-to-equity ratio rising from 15% to 19% over the past 5 years.
What does this mean?
Gyldendal's track record can be a valuable insight into its earnings performance, but it certainly doesn't tell the whole story. In some cases, companies that endure a prolonged period of diminishing earnings are going through some sort of reinvestment phase Although, if the entire industry is struggling to grow over time, it may be a signal of a structural shift, which makes Gyldendal and its peers a higher risk investment. I suggest you continue to research Gyldendal to get a better picture of the stock by looking at:
Future Outlook: What are well-informed industry analysts predicting for GYLD B’s future growth? Take a look at our free research report of analyst consensus for GYLD B’s outlook.
Financial Health: Are GYLD B’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 30 June 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.
