Where Schweitzer-Mauduit International, Inc.'s (NYSE:SWM) Earnings Growth Stands Against Its Industry
Measuring Schweitzer-Mauduit International, Inc.'s (NYSE:SWM) track record of past performance is an insightful exercise for investors. It enables us to reflect on whether the company has met or exceed expectations, which is a powerful signal for future performance. Below, I will assess SWM's recent performance announced on 31 December 2019 and compare these figures to its historical trend and industry movements.
Check out our latest analysis for Schweitzer-Mauduit International
Commentary On SWM's Past Performance
SWM's trailing twelve-month earnings (from 31 December 2019) of US$86m has declined by -8.9% 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 -4.5%, indicating the rate at which SWM is growing has slowed down. Why could this be happening? Well, let’s take a look at what’s occurring with margins and whether the rest of the industry is facing the same headwind.
In terms of returns from investment, Schweitzer-Mauduit International has fallen short of achieving a 20% return on equity (ROE), recording 14% instead. However, its return on assets (ROA) of 8.3% exceeds the US Forestry industry of 6.4%, indicating Schweitzer-Mauduit International has used its assets more efficiently. Though, its return on capital (ROC), which also accounts for Schweitzer-Mauduit International’s debt level, has declined over the past 3 years from 13% to 10%.
What does this mean?
Schweitzer-Mauduit International's track record can be a valuable insight into its earnings performance, but it certainly doesn't tell the whole story. Companies that are profitable, but have capricious earnings, can have many factors affecting its business. I suggest you continue to research Schweitzer-Mauduit International to get a more holistic view of the stock by looking at:
Future Outlook: What are well-informed industry analysts predicting for SWM’s future growth? Take a look at our free research report of analyst consensus for SWM’s outlook.
Financial Health: Are SWM’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 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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