Assessing Clearfield, Inc.’s (NASDAQ:CLFD) past track record of performance is an insightful exercise for investors. It allows us to reflect on whether or not the company has met or exceed expectations, which is a great indicator for future performance. Today I will assess CLFD’s recent performance announced on 31 December 2018 and evaluate these figures to its long-term trend and industry movements.



See our latest analysis for Clearfield

Were CLFD’s earnings stronger than its past performances and the industry?

CLFD’s trailing twelve-month earnings (from 31 December 2018) of US$4.3m has
jumped 11% compared to the previous year.

Furthermore, this one-year growth rate has exceeded its 5-year annual growth average of -7.1%, indicating the rate at which CLFD is growing has accelerated.
How has it been able to do this?
Well, let’s take a look at
if
it is
only
owing to
industry tailwinds,
or if Clearfield has
seen
some company-specific growth.


NasdaqGM:CLFD Income Statement, March 15th 2019
NasdaqGM:CLFD Income Statement, March 15th 2019

In terms of returns from investment, Clearfield has
fallen short of achieving a 20% return on equity (ROE), recording 6.2% instead.
Furthermore, its return on assets (ROA) of 5.1% is below the US Communications industry of 5.5%, indicating Clearfield’s are utilized less efficiently.
And finally, its return on capital (ROC), which also accounts for Clearfield’s debt level, has declined over the past 3 years from 14% to 8.0%.

What does this mean?

Clearfield’s track record can be a valuable insight into its earnings performance, but it certainly doesn’t tell the whole story.
Recent positive growth
isn’t always indicative of a continued optimistic outlook.
There
could
be
factors
that are
influencing
the industry as a whole,
thus
the high industry growth rate over the
same time frame.
You should
continue to research Clearfield to get a
better picture
of the stock by looking at:

  1. Future Outlook: What are well-informed industry analysts predicting for CLFD’s future growth? Take a look at our free research report of analyst consensus for CLFD’s outlook.
  2. Financial Health: Are CLFD’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.
  3. 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 2018. This may not be consistent with full year annual report figures.

We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.

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. Thank you for reading.

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