Yahoo Finance Has Schneider Electric S.E.'s (EPA:SU) Earnings Momentum Changed Recently?
When Schneider Electric S.E. (ENXTPA:SU) 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 Schneider Electric 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 SU has performed.
View our latest analysis for Schneider Electric
Did SU's recent performance beat its trend and industry?
SU's trailing twelve-month earnings (from 30 June 2019) of €2.3b has increased by 1.1% 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 8.6%, indicating the rate at which SU is growing has slowed down. Why could this be happening? Well, let’s take a look at what’s going on with margins and if the whole industry is experiencing the hit as well.
In terms of returns from investment, Schneider Electric has fallen short of achieving a 20% return on equity (ROE), recording 11% instead. Furthermore, its return on assets (ROA) of 5.6% is below the FR Electrical industry of 5.7%, indicating Schneider Electric's are utilized less efficiently. However, its return on capital (ROC), which also accounts for Schneider Electric’s debt level, has increased over the past 3 years from 11% to 11%. This correlates with a decrease in debt holding, with debt-to-equity ratio declining from 49% to 40% over the past 5 years.
What does this mean?
Though Schneider Electric's past data is helpful, it is only one aspect of my investment thesis. While Schneider Electric has a good historical track record with positive growth and profitability, there's no certainty that this will extrapolate into the future. I recommend you continue to research Schneider Electric to get a more holistic view of the stock by looking at:
Future Outlook: What are well-informed industry analysts predicting for SU’s future growth? Take a look at our free research report of analyst consensus for SU’s outlook.
Financial Health: Are SU’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.
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.
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