Has OEM International AB (publ) (STO:OEM B) Improved Earnings Growth In Recent Times?

Simply Wall St

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Understanding how OEM International AB (publ) (STO:OEM B) is performing as a company requires looking at more than just a years' earnings. Today I will run you through a basic sense check to gain perspective on how OEM International is doing by comparing its latest earnings with its long-term trend as well as the performance of its trade distributors industry peers.

Check out our latest analysis for OEM International

How Well Did OEM B Perform?

OEM B's trailing twelve-month earnings (from 31 March 2019) of kr264m has jumped 20% compared to the previous year.

Furthermore, this one-year growth rate has exceeded its 5-year annual growth average of 15%, indicating the rate at which OEM B is growing has accelerated. What's enabled this growth? Let's see whether it is only a result of industry tailwinds, or if OEM International has seen some company-specific growth.

OM:OEM B Income Statement, June 12th 2019

In terms of returns from investment, OEM International has invested its equity funds well leading to a 26% return on equity (ROE), above the sensible minimum of 20%. Furthermore, its return on assets (ROA) of 16% exceeds the SE Trade Distributors industry of 7.6%, indicating OEM International has used its assets more efficiently. And finally, its return on capital (ROC), which also accounts for OEM International’s debt level, has increased over the past 3 years from 28% to 29%.

What does this mean?

Though OEM International's past data is helpful, it is only one aspect of my investment thesis. Companies that have performed well in the past, such as OEM International gives investors conviction. However, the next step would be to assess whether the future looks as optimistic. You should continue to research OEM International to get a better picture of the stock by looking at:

  1. Future Outlook: What are well-informed industry analysts predicting for OEM B’s future growth? Take a look at our free research report of analyst consensus for OEM B’s outlook.
  2. Financial Health: Are OEM 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.
  3. 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.