Is Middlesex Water Company's (NASDAQ:MSEX) Stock Price Struggling As A Result Of Its Mixed Financials?
Is Middlesex Water Company's (NASDAQ:MSEX) Stock Price Struggling As A Result Of Its Mixed Financials?
It is hard to get excited after looking at Middlesex Water's (NASDAQ:MSEX) recent performance, when its stock has declined 4.1% over the past week. We, however decided to study the company's financials to determine if they have got anything to do with the price decline. Fundamentals usually dictate market outcomes so it makes sense to study the company's financials. Particularly, we will be paying attention to Middlesex Water's ROE today.
看了米德爾塞克斯水務(納斯達克股票代碼:MSEX)最近的表現,很難感到興奮,當時其股價在過去一週下跌了4.1%。但是,我們決定研究公司的財務狀況,以確定它們是否與價格下跌有關。基本面通常決定市場結果,因此研究公司的財務狀況是有意義的。特別是,我們今天將關注米德爾塞克斯水務的投資回報率。
Return on equity or ROE is a key measure used to assess how efficiently a company's management is utilizing the company's capital. In short, ROE shows the profit each dollar generates with respect to its shareholder investments.
股本回報率或投資回報率是用於評估公司管理層利用公司資本效率的關鍵衡量標準。簡而言之,投資回報率顯示了每美元從其股東投資中產生的利潤。
View our latest analysis for Middlesex Water
查看我們對米德爾塞克斯水務的最新分析
How Is ROE Calculated?
ROE 是如何計算的?
Return on equity can be calculated by using the formula:
股本回報率可以使用以下公式計算:
Return on Equity = Net Profit (from continuing operations) ÷ Shareholders' Equity
股本回報率 = 淨利潤(來自持續經營)¥股東權益
So, based on the above formula, the ROE for Middlesex Water is:
因此,根據上述公式,米德爾塞克斯水務的投資回報率爲:
7.8% = US$33m ÷ US$422m (Based on the trailing twelve months to September 2023).
7.8% = 3300萬美元 ÷ 4.22億美元(基於截至2023年9月的過去十二個月)。
The 'return' is the income the business earned over the last year. So, this means that for every $1 of its shareholder's investments, the company generates a profit of $0.08.
“回報” 是企業在過去一年中獲得的收入。因此,這意味着公司每投資1美元,就會產生0.08美元的利潤。
What Has ROE Got To Do With Earnings Growth?
投資回報率與收益增長有什麼關係?
We have already established that ROE serves as an efficient profit-generating gauge for a company's future earnings. Based on how much of its profits the company chooses to reinvest or "retain", we are then able to evaluate a company's future ability to generate profits. Generally speaking, other things being equal, firms with a high return on equity and profit retention, have a higher growth rate than firms that don't share these attributes.
我們已經確定,投資回報率是衡量公司未來收益的有效盈利指標。根據公司選擇再投資或 “保留” 的利潤金額,我們隨後能夠評估公司未來的盈利能力。一般而言,在其他條件相同的情況下,股本回報率和利潤保留率高的公司比不具備這些屬性的公司的增長率更高。
A Side By Side comparison of Middlesex Water's Earnings Growth And 7.8% ROE
米德爾塞克斯水務的收益增長和7.8%的投資回報率的並排比較
At first glance, Middlesex Water's ROE doesn't look very promising. However, its ROE is similar to the industry average of 8.1%, so we won't completely dismiss the company. On the other hand, Middlesex Water reported a fairly low 3.6% net income growth over the past five years. Bear in mind, the company's ROE is not very high . So this could also be one of the reasons behind the company's low growth in earnings.
乍一看,米德爾塞克斯水務的投資回報率看起來並不十分樂觀。但是,其投資回報率與行業平均水平的8.1%相似,因此我們不會完全解散該公司。另一方面,米德爾塞克斯水務公司報告稱,在過去五年中,淨收入增長3.6%,相當低。請記住,該公司的投資回報率不是很高。因此,這也可能是該公司收益增長緩慢的原因之一。
As a next step, we compared Middlesex Water's net income growth with the industry and were disappointed to see that the company's growth is lower than the industry average growth of 8.9% in the same period.
下一步,我們將米德爾塞克斯水務的淨收入增長與該行業進行了比較,並失望地看到該公司的增長低於同期8.9%的行業平均增長。
![past-earnings-growth](https://usnewsfile.moomoo.com/public/MM-PersistNewsContentImage/7781/20231226/0-bc7ae0e8559e0fa0f991f127a86fd7e0-0-dcc5e92f7e7813c6077cc89607252b8d.png/big)
Earnings growth is an important metric to consider when valuing a stock. What investors need to determine next is if the expected earnings growth, or the lack of it, is already built into the share price. Doing so will help them establish if the stock's future looks promising or ominous. Is Middlesex Water fairly valued compared to other companies? These 3 valuation measures might help you decide.
收益增長是對股票進行估值時要考慮的重要指標。投資者接下來需要確定的是,預期的收益增長或缺乏收益是否已經包含在股價中。這樣做將幫助他們確定股票的未來是樂觀還是不祥的。與其他公司相比,米德爾塞克斯水務的估值是否合理?這3種估值指標可能會幫助您做出決定。
Is Middlesex Water Using Its Retained Earnings Effectively?
米德爾塞克斯水務公司能否有效利用其留存收益?
Despite having a moderate three-year median payout ratio of 49% (implying that the company retains the remaining 51% of its income), Middlesex Water's earnings growth was quite low. Therefore, there might be some other reasons to explain the lack in that respect. For example, the business could be in decline.
儘管米德爾塞克斯水務的三年派息率中位數爲49%(這意味着該公司保留了剩餘的51%的收入),但其收益增長還是相當低的。因此,可能還有其他一些原因可以解釋這方面的不足。例如,業務可能會下滑。
Moreover, Middlesex Water has been paying dividends for at least ten years or more suggesting that management must have perceived that the shareholders prefer dividends over earnings growth.
此外,米德爾塞克斯水務公司派發股息已有至少十年或更長時間,這表明管理層一定已經意識到股東更喜歡分紅而不是收益增長。
Summary
摘要
In total, we're a bit ambivalent about Middlesex Water's performance. Even though it appears to be retaining most of its profits, given the low ROE, investors may not be benefitting from all that reinvestment after all. The low earnings growth suggests our theory correct. Wrapping up, we would proceed with caution with this company and one way of doing that would be to look at the risk profile of the business. You can see the 2 risks we have identified for Middlesex Water by visiting our risks dashboard for free on our platform here.
總的來說,我們對米德爾塞克斯水務公司的表現有點矛盾。儘管鑑於投資回報率低,它似乎保留了大部分利潤,但投資者畢竟可能無法從所有這些再投資中受益。低收入增長表明我們的理論是正確的。總而言之,我們將謹慎對待這家公司,其中一種方法是研究該業務的風險狀況。您可以訪問我們的 2 種風險來查看我們爲米德爾塞克斯水務公司確定的兩種風險 風險儀表板 在我們的平台上免費使用。
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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
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Simply Wall St 的這篇文章本質上是籠統的。我們僅使用公正的方法提供基於歷史數據和分析師預測的評論,我們的文章並非旨在提供財務建議。它不構成買入或賣出任何股票的建議,也沒有考慮到您的目標或財務狀況。我們的目標是爲您提供由基本數據驅動的長期重點分析。請注意,我們的分析可能不會考慮最新的價格敏感型公司公告或定性材料。華爾街只是沒有持有上述任何股票的頭寸。