Balk 1798 Group (HKG:1010) delivers shareholders decent 48% return over 1 year, surging 25% in the last week alone

These days it's easy to simply buy an index fund, and your returns should (roughly) match the market. But one can do better than that by picking better than average stocks (as part of a diversified portfolio). For example, the Balk 1798 Group Limited (HKG:1010) share price is up 48% in the last 1 year, clearly besting the market return of around 2.0% (not including dividends). So that should have shareholders smiling. However, the longer term returns haven't been so impressive, with the stock up just 30% in the last three years.

Since the stock has added HK$78m to its market cap in the past week alone, let's see if underlying performance has been driving long-term returns.

Check out our latest analysis for Balk 1798 Group

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. By comparing earnings per share (EPS) and share price changes over time, we can get a feel for how investor attitudes to a company have morphed over time.

Balk 1798 Group went from making a loss to reporting a profit, in the last year.

The result looks like a strong improvement to us, so we're not surprised the market likes the growth. Inflection points like this can be a great time to take a closer look at a company.

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

Dive deeper into Balk 1798 Group's key metrics by checking this interactive graph of Balk 1798 Group's earnings, revenue and cash flow.

A Different Perspective

It's good to see that Balk 1798 Group has rewarded shareholders with a total shareholder return of 48% in the last twelve months. There's no doubt those recent returns are much better than the TSR loss of 8% per year over five years. We generally put more weight on the long term performance over the short term, but the recent improvement could hint at a (positive) inflection point within the business. I find it very interesting to look at share price over the long term as a proxy for business performance. But to truly gain insight, we need to consider other information, too. For instance, we've identified 2 warning signs for Balk 1798 Group (1 is a bit unpleasant) that you should be aware of.

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 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.