Is SRG Global Limited's (ASX:SRG) Recent Stock Performance Tethered To Its Strong Fundamentals?

Simply Wall St.09-24

SRG Global's (ASX:SRG) stock is up by a considerable 20% over the past three months. Given the company's impressive performance, we decided to study its financial indicators more closely as a company'...

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Given the company's impressive performance, we decided to study its financial indicators more closely as a company'...</p>\n\n<a href=\"https://finance.yahoo.com/news/srg-global-limiteds-asx-srg-031505530.html\">Source Link</a>\n\n</div>\n","source":"yahoofinance_au","html":"<!DOCTYPE html>\n<html>\n<head>\n<meta http-equiv=\"Content-Type\" content=\"text/html; charset=utf-8\" />\n<meta name=\"viewport\" content=\"width=device-width,initial-scale=1.0,minimum-scale=1.0,maximum-scale=1.0,user-scalable=no\"/>\n<meta name=\"format-detection\" content=\"telephone=no,email=no,address=no\" />\n<title>Is SRG Global Limited's (ASX:SRG) Recent Stock Performance Tethered To Its Strong Fundamentals?</title>\n<style type=\"text/css\">\na,abbr,acronym,address,applet,article,aside,audio,b,big,blockquote,body,canvas,caption,center,cite,code,dd,del,details,dfn,div,dl,dt,\nem,embed,fieldset,figcaption,figure,footer,form,h1,h2,h3,h4,h5,h6,header,hgroup,html,i,iframe,img,ins,kbd,label,legend,li,mark,menu,nav,\nobject,ol,output,p,pre,q,ruby,s,samp,section,small,span,strike,strong,sub,summary,sup,table,tbody,td,tfoot,th,thead,time,tr,tt,u,ul,var,video{ font:inherit;margin:0;padding:0;vertical-align:baseline;border:0 }\nbody{ font-size:16px; line-height:1.5; color:#999; background:transparent; }\n.wrapper{ overflow:hidden;word-break:break-all;padding:10px; }\nh1,h2{ font-weight:normal; line-height:1.35; margin-bottom:.6em; }\nh3,h4,h5,h6{ line-height:1.35; margin-bottom:1em; }\nh1{ font-size:24px; }\nh2{ font-size:20px; }\nh3{ font-size:18px; }\nh4{ font-size:16px; }\nh5{ font-size:14px; }\nh6{ font-size:12px; }\np,ul,ol,blockquote,dl,table{ margin:1.2em 0; }\nul,ol{ margin-left:2em; }\nul{ list-style:disc; }\nol{ list-style:decimal; }\nli,li p{ margin:10px 0;}\nimg{ max-width:100%;display:block;margin:0 auto 1em; }\nblockquote{ color:#B5B2B1; border-left:3px solid #aaa; padding:1em; }\nstrong,b{font-weight:bold;}\nem,i{font-style:italic;}\ntable{ width:100%;border-collapse:collapse;border-spacing:1px;margin:1em 0;font-size:.9em; }\nth,td{ padding:5px;text-align:left;border:1px solid #aaa; }\nth{ font-weight:bold;background:#5d5d5d; }\n.symbol-link{font-weight:bold;}\n/* header{ border-bottom:1px solid #494756; } */\n.title{ margin:0 0 8px;line-height:1.3;color:#ddd; }\n.meta {color:#5e5c6d;font-size:13px;margin:0 0 .5em; }\na{text-decoration:none; color:#2a4b87;}\n.meta .head { display: inline-block; overflow: hidden}\n.head .h-thumb { width: 30px; height: 30px; margin: 0; padding: 0; border-radius: 50%; float: left;}\n.head .h-content { margin: 0; padding: 0 0 0 9px; float: left;}\n.head .h-name {font-size: 13px; color: #eee; margin: 0;}\n.head .h-time {font-size: 11px; color: #7E829C; margin: 0;line-height: 11px;}\n.small {font-size: 12.5px; display: inline-block; transform: scale(0.9); -webkit-transform: scale(0.9); transform-origin: left; -webkit-transform-origin: left;}\n.smaller {font-size: 12.5px; display: inline-block; transform: scale(0.8); -webkit-transform: scale(0.8); transform-origin: left; -webkit-transform-origin: left;}\n.bt-text {font-size: 12px;margin: 1.5em 0 0 0}\n.bt-text p {margin: 0}\n</style>\n</head>\n<body>\n<div class=\"wrapper\">\n<header>\n<h2 class=\"title\">\nIs SRG Global Limited's (ASX:SRG) Recent Stock Performance Tethered To Its Strong Fundamentals?\n</h2>\n\n<h4 class=\"meta\">\n\n\n2024-09-24 11:15 GMT+8&nbsp;&nbsp;&nbsp;<a href=https://finance.yahoo.com/news/srg-global-limiteds-asx-srg-031505530.html><strong>Simply Wall St.</strong></a>\n\n\n</h4>\n\n</header>\n<article>\n<div>\n<p>SRG Global's (ASX:SRG) stock is up by a considerable 20% over the past three months. Given the company's impressive performance, we decided to study its financial indicators more closely as a company'...</p>\n\n<a href=\"https://finance.yahoo.com/news/srg-global-limiteds-asx-srg-031505530.html\">Source Link</a>\n\n</div>\n\n\n</article>\n</div>\n</body>\n</html>\n","isBrief":false,"type":0,"news_type":1,"symbol":"BK4233","symbol_name":"房地产运营公司","start_time":0,"source_url":"https://finance.yahoo.com/news/srg-global-limiteds-asx-srg-031505530.html","article_id":"2469481225","we_media_id":null,"thumbnails":["https://s.yimg.com/uu/api/res/1.2/n4P4inB0rRJrLC1wDK2ibA--~B/aD00MzI7dz0xMTk0O2FwcGlkPXl0YWNoeW9u/https://media.zenfs.com/en/simply_wall_st__316/9387484536d295ac2492be4d631ec660"],"rights":null,"url":"https://stock-news.laohu8.com/highlight/detail?id=2469481225","pubTimestamp":1727147705,"sourceInfo":{"source_id":"yahoofinance_au","name":"Yahoo Finance AU"},"weMediaInfo":null,"summary":"SRG Global's  stock is up by a considerable 20% over the past three months. Given the company's impressive performance, we decided to study its financial indicators more closely as a company's financial health over the long-term usually dictates market outcomes. Specifically, we decided to study SRG Global's  ROE in this article.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 simpler terms, it measures the profitability of a company in relation to shareholder's equity.Return on Equity = Net Profit  ÷ Shareholders' Equity. So, based on the above formula, the ROE for SRG Global is:. At first glance, SRG Global seems to have a decent ROE. Even when compared to the industry average of 13% the company's ROE looks quite decent. Consequently, this likely laid the ground for the impressive net income growth of 46% seen over the past five years by SRG Global. However, there could also be other drivers behind t","collect":0,"end_time":0,"defaultTopTitle":"yahoo.com","property":[],"viewcount":null,"language":"en","relate_stocks":{"BK4233":"房地产运营公司","BK7055":"建筑与工程","BK4080":"零售业房地产投资信托","SRG":"Seritage Growth Properties","SRG.AU":"SRG GLOBAL LTD","BK4205":"房地产经营公司"},"translate_title":"SRG Global Limited(ASX：SRG)最近的股票表现是否与其强劲的基本面有关？","themeId":null,"isJumpTheme":false,"ttsUrl":null,"symbols_score_info":{"SRG":1,"SRG.AU":1},"content_text":"SRG Global's (ASX:SRG) stock is up by a considerable 20% over the past three months. Given the company's impressive performance, we decided to study its financial indicators more closely as a company's financial health over the long-term usually dictates market outcomes. Specifically, we decided to study SRG Global's  ROE in this article. \n 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 simpler terms, it measures the profitability of a company in relation to shareholder's equity. \n Check out our latest analysis for SRG Global \n How To Calculate Return On Equity? \n The formula for return on equity is: \n Return on Equity = Net Profit (from continuing operations) ÷ Shareholders' Equity \nSo, based on the above formula, the ROE for SRG Global is:\n11% = AU$34m ÷ AU$305m (Based on the trailing twelve months to June 2024).\n The 'return' is the yearly profit. One way to conceptualize this is that for each A$1 of shareholders' capital it has, the company made A$0.11 in profit. \n What Is The Relationship Between ROE And Earnings Growth? \n So far, we've learned that ROE is a measure of a company's profitability. 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. \n SRG Global's Earnings Growth And 11% ROE \n At first glance, SRG Global seems to have a decent ROE. Even when compared to the industry average of 13% the company's ROE looks quite decent. Consequently, this likely laid the ground for the impressive net income growth of 46% seen over the past five years by SRG Global. However, there could also be other drivers behind this growth. Such as - high earnings retention or an efficient management in place. \n As a next step, we compared SRG Global's net income growth with the industry, and pleasingly, we found that the growth seen by the company is higher than the average industry growth of 25%. \n\n\n\n  ASX:SRG Past Earnings Growth September 24th 2024\n \n\n Earnings growth is a huge factor in stock valuation. The investor should try to establish if the expected growth or decline in earnings, whichever the case may be, is priced in. This then helps them determine if the stock is placed for a bright or bleak future. Is SRG fairly valued? This infographic on the company's intrinsic value  has everything you need to know. \n Is SRG Global Using Its Retained Earnings Effectively? \n The high three-year median payout ratio of 68% (implying that it keeps only 32% of profits) for SRG Global suggests that the company's growth wasn't really hampered despite it returning most of the earnings to its shareholders. \n Besides, SRG Global has been paying dividends over a period of six years. This shows that the company is committed to sharing profits with its shareholders. Upon studying the latest analysts' consensus data, we found that the company is expected to keep paying out approximately 61% of its profits over the next three years. However, SRG Global's ROE is predicted to rise to 15% despite there being no anticipated change in its payout ratio. \n Summary \n In total, we are pretty happy with SRG Global's performance. Especially the high ROE, Which has contributed to the impressive growth seen in earnings. Despite the company reinvesting only a small portion of its profits, it still has managed to grow its earnings so that is appreciable. That being so, a study of the latest analyst forecasts show that the company is expected to see a slowdown in its future earnings growth. To know more about the company's future earnings growth forecasts take a look at this free report on analyst forecasts for the company to find out more. \nHave feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.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. 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