For long term investors,eero thread on or off improvement in profitability and outperformance against the industry can be important characteristics in a stock. In this article, I will take a look at Standex International Corporation’s (

NYSE:SXI

) track record on a high level, to give you some insight into how the company has been performing against its historical trend and its industry peers.

Check out our latest analysis for Standex International

How Well Did SXI Perform?

SXI’s trailing twelve-month earnings (from 30 September 2018) of US$38m has declined by -15% 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 -5.3%, indicating the rate at which SXI is growing has slowed down. What could be happening here? Well, let’s look at what’s transpiring with margins and if the rest of the industry is experiencing the hit as well.

NYSE:SXI Income Statement Export January 2nd 19

In terms of returns from investment, Standex International has fallen short of achieving a 20% return on equity (ROE), recording 8.3% instead. Furthermore, its return on assets (ROA) of 4.6% is below the US Machinery industry of 6.7%, indicating Standex International’s are utilized less efficiently. And finally, its return on capital (ROC), which also accounts for Standex International’s debt level, has declined over the past 3 years from 16% to 11%. This correlates with an increase in debt holding, with debt-to-equity ratio rising from 17% to 65% over the past 5 years.

What does this mean?

Standex International’s track record can be a valuable insight into its earnings performance, but it certainly doesn’t tell the whole story. Typically companies that face an extended period of decline in earnings are undergoing some sort of reinvestment phase with the aim of keeping up with the recent industry disruption and expansion. You should continue to research Standex International to get a better picture of the stock by looking at:

Future Outlook

: What are well-informed industry analysts predicting for SXI’s future growth? Take a look at our

free research report of analyst consensus

for SXI’s outlook.

Financial Health

: Are SXI’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 September 2018. This may not be consistent with full year annual report figures.

To help readers see past 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. For errors that warrant correction please contact the editor at

[email protected]

.

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