The Deoleo (BME:OLE) Share Price Has Soared 880%, Delighting Many Shareholders

While stock picking isn't easy, for those willing to persist and learn, it is possible to buy shares in great companies, and generate wonderful returns. When you find (and hold) a big winner, you can markedly improve your finances. For example, the Deoleo, S.A. (BME:OLE) share price is up a whopping 880% in the last year, a handsome return in a single year. In more good news, the share price has risen 30% in thirty days. It is also impressive that the stock is up 106% over three years, adding to the sense that it is a real winner.

Anyone who held for that rewarding ride would probably be keen to talk about it.

See our latest analysis for Deoleo

In his essay The Superinvestors of Graham-and-Doddsville Warren Buffett described how share prices do not always rationally reflect the value of a business. One way to examine how market sentiment has changed over time is to look at the interaction between a company's share price and its earnings per share (EPS).

Deoleo went from making a loss to reporting a profit, in the last year.

While it's good to see positive EPS of €0.18 this year, the loss wasn't too bad last year. But judging by the share price, the market is very pleased with the milestone of reaching profitability. Some investors scan for companies that have just become profitable, since that's an important business development milestone.

You can see below how EPS has changed over time (discover the exact values by clicking on the image).

It might be well worthwhile taking a look at our free report on Deoleo's earnings, revenue and cash flow.

A Different Perspective

It's good to see that Deoleo has rewarded shareholders with a total shareholder return of 880% in the last twelve months. Since the one-year TSR is better than the five-year TSR (the latter coming in at 14% per year), it would seem that the stock's performance has improved in recent times. Given the share price momentum remains strong, it might be worth taking a closer look at the stock, lest you miss an opportunity. It's always interesting to track share price performance over the longer term. But to understand Deoleo better, we need to consider many other factors. Case in point: We've spotted 3 warning signs for Deoleo you should be aware of, and 2 of them are potentially serious.

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 ES 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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