Did You Miss Cosmos Machinery Enterprises' (HKG:118) 62% Share Price Gain?

These days it's easy to simply buy an index fund, and your returns should (roughly) match the market. But you can significantly boost your returns by picking above-average stocks. To wit, the Cosmos Machinery Enterprises Limited (HKG:118) share price is 62% higher than it was a year ago, much better than the market return of around 1.6% (not including dividends) in the same period. So that should have shareholders smiling. However, the stock hasn't done so well in the longer term, with the stock only up 3.0% in three years.

Check out our latest analysis for Cosmos Machinery Enterprises

Because Cosmos Machinery Enterprises 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. 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.

Cosmos Machinery Enterprises actually shrunk its revenue over the last year, with a reduction of 11%. The stock is up 62% in that time, a fine performance given the revenue drop. We can correlate the share price rise with revenue or profit growth, but it seems the market had previously expected weaker results, and sentiment around the stock is improving.

The image below shows how earnings and revenue have tracked over time (if you click on the image you can see greater detail).

Take a more thorough look at Cosmos Machinery Enterprises' financial health with this free report on its balance sheet.

A Different Perspective

We're pleased to report that Cosmos Machinery Enterprises shareholders have received a total shareholder return of 62% over one year. Since the one-year TSR is better than the five-year TSR (the latter coming in at 0.1% 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 Cosmos Machinery Enterprises better, we need to consider many other factors. Take risks, for example - Cosmos Machinery Enterprises has 2 warning signs we think you should be aware of.

But note: Cosmos Machinery Enterprises may not be the best stock to buy. So take a peek at this free list of interesting companies with past earnings growth (and further growth forecast).

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