Yahoo Finance Are Earnings Prospects Improving For Loss-Making Alexander Mining plc’s (LON:AXM)?
Examining how Alexander Mining plc (AIM:AXM) is performing as a company requires looking at more than just a years’ earnings. Below, I will run you through a simple sense check to build perspective on how Alexander Mining is doing by comparing its most recent earnings with its historical trend, in addition to the performance of its metals and mining industry peers. Check out our latest analysis for Alexander Mining
Were AXM’s earnings stronger than its past performances and the industry?
For the most up-to-date info, I use the ‘latest twelve-month’ data, which either annualizes the most recent 6-month earnings update, or in some cases, the most recent annual report is already the latest available financial data. This method enables me to analyze different companies on a more comparable basis, using new information. For Alexander Mining, its latest trailing-twelve-month earnings is -UK£430.00K, which, relative to the prior year’s figure, has become less negative. Given that these values may be somewhat nearsighted, I’ve estimated an annualized five-year value for AXM’s earnings, which stands at -UK£1.06M. This means although net income is negative, it has become less negative over the years.
We can further evaluate Alexander Mining’s loss by looking at what the industry has been experiencing over the past few years. Each year, for the past half a decade Alexander Mining’s top-line has increased by 16.47% on average, implying that the company is in a high-growth phase with expenses racing ahead revenues, leading to annual losses. Eyeballing growth from a sector-level, the UK metals and mining industry has been growing its average earnings by double-digit 28.48% over the prior year, . This is a change from a volatile drop of -3.33% in the previous couple of years. This shows that whatever uplift the industry is benefiting from, Alexander Mining has not been able to leverage it as much as its average peer.
What does this mean?
While past data is useful, it doesn’t tell the whole story. Companies that incur net loss is always difficult to predict what will occur going forward, and when. The most insightful step is to examine company-specific issues Alexander Mining may be facing and whether management guidance has consistently been met in the past. You should continue to research Alexander Mining to get a better picture of the stock by looking at:
Financial Health: Is AXM’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 December 2017. 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.
