Shareholders Of PARKEN Sport & Entertainment (CPH:PARKEN) Must Be Happy With Their 56% Return

The main point of investing for the long term is to make money. Better yet, you'd like to see the share price move up more than the market average. Unfortunately for shareholders, while the PARKEN Sport & Entertainment A/S (CPH:PARKEN) share price is up 32% in the last five years, that's less than the market return. But if you include dividends then the return is market-beating. Unfortunately the share price is down 30% in the last year.

Check out our latest analysis for PARKEN Sport & Entertainment

Given that PARKEN Sport & Entertainment didn't make a profit in the last twelve months, we'll focus on revenue growth to form a quick view of its business development. Generally speaking, companies without profits are expected to grow revenue every year, and at a good clip. That's because fast revenue growth can be easily extrapolated to forecast profits, often of considerable size.

In the last 5 years PARKEN Sport & Entertainment saw its revenue shrink by 13% per year. The falling revenue is arguably somewhat reflected in the lacklustre return of 6% per year over that time. That's pretty decent given the top line decline, and lack of profits. We'd keep an eye on changes in the trend - there may be an opportunity if the company returns to growth.

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

This free interactive report on PARKEN Sport & Entertainment's balance sheet strength is a great place to start, if you want to investigate the stock further.

What about the Total Shareholder Return (TSR)?

We've already covered PARKEN Sport & Entertainment's share price action, but we should also mention its total shareholder return (TSR). 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. PARKEN Sport & Entertainment's TSR of 56% for the 5 years exceeded its share price return, because it has paid dividends.

A Different Perspective

Investors in PARKEN Sport & Entertainment had a tough year, with a total loss of 30%, against a market gain of about 30%. 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. On the bright side, long term shareholders have made money, with a gain of 9% per year over half a decade. If the fundamental data continues to indicate long term sustainable growth, the current sell-off could be an opportunity worth considering. It's always interesting to track share price performance over the longer term. But to understand PARKEN Sport & Entertainment better, we need to consider many other factors. To that end, you should be aware of the 2 warning signs we've spotted with PARKEN Sport & Entertainment .

Of course PARKEN Sport & Entertainment may not be the best stock to buy. So you may wish to see this free collection of growth stocks.

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

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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. 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.
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