Yahoo Finance Where Exact Sciences Corporation (NASDAQ:EXAS) Stands In Earnings Growth Against Its Industry
After reading Exact Sciences Corporation’s (NASDAQ:EXAS) most recent earnings announcement (31 March 2018), I found it useful to look back at how the company has performed in the past and compare this against the latest numbers. As a long term investor, I pay close attention to earnings trend, rather than the figures published at one point in time. I also compare against an industry benchmark to check whether Exact Sciences’s performance has been impacted by industry movements. In this article I briefly touch on my key findings. See our latest analysis for Exact Sciences
Commentary On EXAS’s Past Performance
I look at data from the most recent 12 months, which annualizes the latest 6-month earnings release, or some times, the latest annual report is already the most recent financial data. This enables me to assess different stocks on a similar basis, using the latest information. For Exact Sciences, its latest earnings (trailing twelve month) is -US$118.87M, which, against the previous year’s level, has become less negative. Given that these values may be fairly short-term, I’ve estimated an annualized five-year value for Exact Sciences’s earnings, which stands at -US$94.41M. This means that, Exact Sciences has historically performed better than recently, despite the fact that it seems like earnings are now heading back towards a more favorable position once more.
We can further analyze Exact Sciences’s loss by looking at what the industry has been experiencing over the past few years. Each year, for the past half a decade Exact Sciences’s top-line has risen by 60.41% on average, indicating that the company is in a high-growth phase with expenses racing ahead revenues, leading to annual losses. Scanning growth from a sector-level, the US biotechs industry has been growing its average earnings by double-digit 21.75% over the previous twelve months, and 18.34% over the previous five years. This suggests that, despite the fact that Exact Sciences is currently unprofitable, it may have been aided by industry tailwinds, moving earnings into a more favorable position.
What does this mean?
Though Exact Sciences’s past data is helpful, it is only one aspect of my investment thesis. Companies that incur net loss is always hard to envisage what will happen in the future and when. The most insightful step is to assess company-specific issues Exact Sciences may be facing and whether management guidance has regularly been met in the past. I recommend you continue to research Exact Sciences to get a better picture of the stock by looking at:
Future Outlook: What are well-informed industry analysts predicting for EXAS’s future growth? Take a look at our free research report of analyst consensus for EXAS’s outlook.
Financial Health: Is EXAS’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 2018. This may not be consistent with full year annual report figures.
To help readers see pass the short term volatility of the financial market, we aim to bring you a long-term focused research analysis purely driven by fundamental data. Note that our analysis does not factor in the latest price sensitive company announcements.
The author is an independent contributor and at the time of publication had no position in the stocks mentioned.
