Stock Analysis

Introducing Maggie Beer Holdings (ASX:MBH), The Stock That Zoomed 169% In The Last Year

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ASX:MBH
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When you buy shares in a company, there is always a risk that the price drops to zero. But if you pick the right stock, you can make a lot more than 100%. For example, the Maggie Beer Holdings Limited (ASX:MBH) share price had more than doubled in just one year - up 169%. Also pleasing for shareholders was the 76% gain in the last three months. On the other hand, longer term shareholders have had a tougher run, with the stock falling 68% in three years.

See our latest analysis for Maggie Beer Holdings

Maggie Beer Holdings isn't currently profitable, so most analysts would look to revenue growth to get an idea of how fast the underlying business is growing. When a company doesn't make profits, we'd generally expect to see good revenue growth. Some companies are willing to postpone profitability to grow revenue faster, but in that case one does expect good top-line growth.

In the last year Maggie Beer Holdings saw its revenue grow by 72%. That's a head and shoulders above most loss-making companies. And the share price has responded, gaining 169% as we previously mentioned. That sort of revenue growth is bound to attract attention, even if the company doesn't turn a profit. Given the positive sentiment around the stock we're cautious, but there's no doubt its worth watching.

You can see below how earnings and revenue have changed over time (discover the exact values by clicking on the image).

earnings-and-revenue-growth
ASX:MBH Earnings and Revenue Growth December 15th 2020

We like that insiders have been buying shares in the last twelve months. Having said that, most people consider earnings and revenue growth trends to be a more meaningful guide to the business. It might be well worthwhile taking a look at our free report on Maggie Beer Holdings' earnings, revenue and cash flow.

A Different Perspective

It's good to see that Maggie Beer Holdings has rewarded shareholders with a total shareholder return of 169% in the last twelve months. That certainly beats the loss of about 8% per year over the last half decade. We generally put more weight on the long term performance over the short term, but the recent improvement could hint at a (positive) inflection point within the business. While it is well worth considering the different impacts that market conditions can have on the share price, there are other factors that are even more important. For instance, we've identified 3 warning signs for Maggie Beer Holdings (1 makes us a bit uncomfortable) that you should be aware of.

Maggie Beer Holdings is not the only stock insiders are buying. So take a peek at this free list of growing companies with insider buying.

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

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