The 34% return this week takes BeijingWest Industries International's (HKG:2339) shareholders one-year gains to 545%

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 BeijingWest Industries International Limited (HKG:2339) share price rocketed moonwards 545% in just one year. It's also good to see the share price up 182% over the last quarter. And shareholders have also done well over the long term, with an increase of 143% in the last three years. We love happy stories like this one. The company should be really proud of that performance!

Since the stock has added HK$233m to its market cap in the past week alone, let's see if underlying performance has been driving long-term returns.

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Because BeijingWest Industries International made a loss in the last twelve months, we think the market is probably more focussed on revenue and revenue growth, at least for now. 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.

Over the last twelve months, BeijingWest Industries International's revenue grew by 8.4%. That's not great considering the company is losing money. So the 545% gain in just twelve months is completely unexpected. We're happy that investors have made money, but we can't help questioning whether the rise is sustainable. It just goes to show that big money can be made if you buy the right stock early.

The graphic below depicts how earnings and revenue have changed over time (unveil the exact values by clicking on the image).

We're pleased to report that the CEO is remunerated more modestly than most CEOs at similarly capitalized companies. It's always worth keeping an eye on CEO pay, but a more important question is whether the company will grow earnings throughout the years. This free interactive report on BeijingWest Industries International's earnings, revenue and cash flow is a great place to start, if you want to investigate the stock further.

A Different Perspective

It's good to see that BeijingWest Industries International has rewarded shareholders with a total shareholder return of 545% in the last twelve months. Since the one-year TSR is better than the five-year TSR (the latter coming in at 11% per year), it would seem that the stock's performance has improved in recent times. 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 BeijingWest Industries International better, we need to consider many other factors. Even so, be aware that BeijingWest Industries International is showing 2 warning signs in our investment analysis , and 1 of those is a bit unpleasant...

We will like BeijingWest Industries International 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 Hong Kong 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.