It hasn’t been the best quarter for Hövding Sverige AB (publ) (STO:HOVD) shareholders, since the share price has fallen 16% in that time. But that doesn’t change the reality that over twelve months the stock has done really well. In that time we’ve seen the stock easily surpass the market return, with a gain of 69%.
Because Hövding Sverige is loss-making, we think the market is probably more focussed on revenue and revenue growth, at least for now. When a company doesn’t make profits, we’d generally expect to see good revenue growth. As you can imagine, fast revenue growth, when maintained, often leads to fast profit growth.
In the last year Hövding Sverige saw its revenue grow by 13%. That’s not great considering the company is losing money. The modest growth is probably largely reflected in the share price, which is up 69%. While not a huge gain tht seems pretty reasonable. It could be worth keeping an eye on this one, especially if growth accelerates.
The company’s revenue and earnings (over time) are depicted in the image below.
You can see how its balance sheet has strengthened (or weakened) over time in this free interactive graphic.
What about the Total Shareholder Return (TSR)?
Investors should note that there’s a difference between Hövding Sverige’s total shareholder return (TSR) and its share price change, which we’ve covered above. Arguably the TSR is a more complete return calculation because it accounts for the value of dividends (as if they were reinvested), along with the hypothetical value of any discounted capital that have been offered to shareholders. We note that Hövding Sverige’s TSR, at 69% is higher than its share price return of 69%. When you consider it hasn’t been paying a dividend, this data suggests shareholders have benefitted from a spin-off, or had the opportunity to acquire attractively priced shares in a discounted capital raising.
A Different Perspective
We’re pleased to report that Hövding Sverige rewarded shareholders with a total shareholder return of 69% over the last year. So this year’s TSR was actually better than the three-year TSR (annualized) of 24%. Given the track record of solid returns over varying time frames, it might be worth putting Hövding Sverige on your watchlist. Before spending more time on Hövding Sverige it might be wise to click here to see if insiders have been buying or selling shares.
If you would prefer to check out another company — one with potentially superior financials — then do not miss this free list of companies that have proven they can grow earnings.
Please note, the market returns quoted in this article reflect the market weighted average returns of stocks that currently trade on SE exchanges.
If you spot an error that warrants correction, please contact the editor at firstname.lastname@example.org. 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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