Stock Analysis

The 14% return this week takes Dubai Islamic Insurance & Reinsurance (Aman) (P.J.S.C)'s (DFM:AMAN) shareholders three-year gains to 108%

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It might seem bad, but the worst that can happen when you buy a stock (without leverage) is that its share price goes to zero. But if you buy shares in a really great company, you can more than double your money. For example, the Dubai Islamic Insurance & Reinsurance Co. (Aman) (P.J.S.C) (DFM:AMAN) share price has soared 108% in the last three years. That sort of return is as solid as granite. Better yet, the share price has risen 14% in the last week.

The past week has proven to be lucrative for Dubai Islamic Insurance & Reinsurance (Aman) (P.J.S.C) investors, so let's see if fundamentals drove the company's three-year performance.

Though if you're not interested in researching what drove AMAN's performance, we have a free list of interesting investing ideas to potentially inspire your next investment!

Dubai Islamic Insurance & Reinsurance (Aman) (P.J.S.C) isn't currently profitable, so most analysts would look to revenue growth to get an idea of how fast the underlying business is growing. Shareholders of unprofitable companies usually expect strong revenue growth. That's because it's hard to be confident a company will be sustainable if revenue growth is negligible, and it never makes a profit.

In the last 3 years Dubai Islamic Insurance & Reinsurance (Aman) (P.J.S.C) saw its revenue grow at 8.0% per year. That's not a very high growth rate considering it doesn't make profits. In comparison, the share price rise of 28% per year over the last three years is pretty impressive. Shareholders should be pretty happy with that, although interested investors might want to examine the financial data more closely to see if the gains are really justified. It may be that the market is pretty optimistic about Dubai Islamic Insurance & Reinsurance (Aman) (P.J.S.C) if you look to the bottom line.

The graphic below depicts how earnings and revenue have changed over time (unveil the exact values by clicking on the image).

DFM:AMAN Earnings and Revenue Growth October 4th 2022

This free interactive report on Dubai Islamic Insurance & Reinsurance (Aman) (P.J.S.C)'s balance sheet strength is a great place to start, if you want to investigate the stock further.

A Different Perspective

While the broader market gained around 35% in the last year, Dubai Islamic Insurance & Reinsurance (Aman) (P.J.S.C) shareholders lost 11%. Even the share prices of good stocks drop sometimes, but we want to see improvements in the fundamental metrics of a business, before getting too interested. Unfortunately, last year's performance may indicate unresolved challenges, given that it was worse than the annualised loss of 0.1% over the last half decade. We realise that Baron Rothschild has said investors should "buy when there is blood on the streets", but we caution that investors should first be sure they are buying a high quality business. It's always interesting to track share price performance over the longer term. But to understand Dubai Islamic Insurance & Reinsurance (Aman) (P.J.S.C) better, we need to consider many other factors. Even so, be aware that Dubai Islamic Insurance & Reinsurance (Aman) (P.J.S.C) is showing 2 warning signs in our investment analysis , you should know about...

We will like Dubai Islamic Insurance & Reinsurance (Aman) (P.J.S.C) better if we see some big insider buys. While we wait, check out this free list of growing companies with considerable, recent, insider buying.

Please note, the market returns quoted in this article reflect the market weighted average returns of stocks that currently trade on AE exchanges.

Valuation is complex, but we're helping make it simple.

Find out whether Dubai Islamic Insurance & Reinsurance (Aman) (P.J.S.C) is potentially over or undervalued by checking out our comprehensive analysis, which includes fair value estimates, risks and warnings, dividends, insider transactions and financial health.

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Dubai Islamic Insurance & Reinsurance (Aman) (P.J.S.C)

Dubai Islamic Insurance & Reinsurance Co.

The Snowflake is a visual investment summary with the score of each axis being calculated by 6 checks in 5 areas.

Analysis AreaScore (0-6)
Future Growth0
Past Performance0
Financial Health6

Read more about these checks in the individual report sections or in our analysis model.

Flawless balance sheet with weak fundamentals.