The 64% return this week takes Shaw Brothers Holdings' (HKG:953) shareholders three-year gains to 179%

It might seem bad, but the worst that can happen when you buy a stock (without leverage) is that its share price goes to zero. But in contrast you can make much more than 100% if the company does well. For instance the Shaw Brothers Holdings Limited (HKG:953) share price is 179% higher than it was three years ago. How nice for those who held the stock! Also pleasing for shareholders was the 158% gain in the last three months.

Since it's been a strong week for Shaw Brothers Holdings shareholders, let's have a look at trend of the longer term fundamentals.

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Given that Shaw Brothers Holdings 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. When a company doesn't make profits, we'd generally hope to see good revenue growth. As you can imagine, fast revenue growth, when maintained, often leads to fast profit growth.

Shaw Brothers Holdings actually saw its revenue drop by 53% per year over three years. So the share price gain of 41% per year is quite surprising. It's a good reminder that expectations about the future, not the past history, always impact share prices.

The company's revenue and earnings (over time) are depicted in the image below (click to see the exact numbers).

If you are thinking of buying or selling Shaw Brothers Holdings stock, you should check out this FREE detailed report on its balance sheet.

A Different Perspective

It's nice to see that Shaw Brothers Holdings shareholders have received a total shareholder return of 176% over the last year. That gain is better than the annual TSR over five years, which is 20%. Therefore it seems like sentiment around the company has been positive lately. Someone with an optimistic perspective could view the recent improvement in TSR as indicating that the business itself is getting better with time. While it is well worth considering the different impacts that market conditions can have on the share price, there are other factors that are even more important. To that end, you should learn about the 3 warning signs we've spotted with Shaw Brothers Holdings (including 1 which shouldn't be ignored) .

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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.