Despite shrinking by AU$52m in the past week, Dimerix (ASX:DXB) shareholders are still up 546% over 1 year

It's been a soft week for Dimerix Limited (ASX:DXB) shares, which are down 17%. But that doesn't change the fact that the returns over the last year have been spectacular. In that time, shareholders have had the pleasure of a 546% boost to the share price. So we wouldn't blame sellers for taking some profits. While winners often keep winning, it can pay to be cautious after a strong rise. We love happy stories like this one. The company should be really proud of that performance!

While the stock has fallen 17% this week, it's worth focusing on the longer term and seeing if the stocks historical returns have been driven by the underlying fundamentals.

Check out our latest analysis for Dimerix

Dimerix 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 hope to see good 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.

Over the last twelve months, Dimerix's revenue grew by 41%. We respect that sort of growth, no doubt. Arguably it's more than reflected in the truly wondrous share price gain of 546% in the last year. We're always cautious when the share price is up so much, but there's certainly enough revenue growth to justify taking a closer look at Dimerix.

You can see how earnings and revenue have changed over time in the image below (click on the chart to see the exact values).

It's probably worth noting that the CEO is paid less than the median at similar sized companies. But while CEO remuneration is always worth checking, the really important question is whether the company can grow earnings going forward. This free interactive report on Dimerix's earnings, revenue and cash flow is a great place to start, if you want to investigate the stock further.

A Different Perspective

We're pleased to report that Dimerix shareholders have received a total shareholder return of 546% over one year. That's better than the annualised return of 34% over half a decade, implying that the company is doing better recently. Someone with an optimistic perspective could view the recent improvement in TSR as indicating that the business itself is getting better with time. It's always interesting to track share price performance over the longer term. But to understand Dimerix better, we need to consider many other factors. Even so, be aware that Dimerix is showing 3 warning signs in our investment analysis , and 1 of those is concerning...

We will like Dimerix better if we see some big insider buys. While we wait, check out this free list of undervalued stocks (mostly small caps) 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 Australian exchanges.

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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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com