If You Had Bought Denison Mines (TSE:DML) Stock Five Years Ago, You’d Be Sitting On A 56% Loss, Today

Denison Mines Corp. (TSE:DML) shareholders should be happy to see the share price up 14% in the last quarter. But don’t envy holders — looking back over 5 years the returns have been really bad. In fact, the share price has declined rather badly, down some 56% in that time. So we’re not so sure if the recent bounce should be celebrated. Of course, this could be the start of a turnaround.

View our latest analysis for Denison Mines

Because Denison Mines 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 half decade, Denison Mines saw its revenue increase by 7.0% per year. That’s a pretty good rate for a long time period. The share price, meanwhile, has fallen 15% compounded, over five years. That suggests the market is disappointed with the current growth rate. A pessimistic market can create opportunities.

The graphic below shows how revenue and earnings have changed as management guided the business forward. If you want to see cashflow, you can click on the chart.

TSX:DML Income Statement, March 18th 2019
TSX:DML Income Statement, March 18th 2019

We like that insiders have been buying shares in the last twelve months. Even so, future earnings will be far more important to whether current shareholders make money. If you are thinking of buying or selling Denison Mines stock, you should check out this free report showing analyst profit forecasts.

A Different Perspective

We’re pleased to report that Denison Mines shareholders have received a total shareholder return of 24% over one year. That certainly beats the loss of about 15% per year over the last half decade. The long term loss makes us cautious, but the short term TSR gain certainly hints at a brighter future. Investors who like to make money usually check up on insider purchases, such as the price paid, and total amount bought. You can find out about the insider purchases of Denison Mines by clicking this link.

Denison Mines is not the only stock that insiders are buying. For those who like to find winning investments this free list of growing companies with recent insider purchasing, could be just the ticket.

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

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