Ðuro Ðakovic Grupa d.d's (ZGSE:DDJH) one-year earnings growth trails the 328% YoY shareholder returns

While some are satisfied with an index fund, active investors aim to find truly magnificent investments on the stock market. When you buy and hold the right company, the returns can make a huge difference to both you and your family. In the case of Ðuro Ðakovic Grupa d.d. (ZGSE:DDJH), the share price is up an incredible 328% in the last year alone. On top of that, the share price is up 43% in about a quarter. This could be related to the recent financial results, released recently - you can catch up on the most recent data by reading our company report. Also impressive, the stock is up 236% over three years, making long term shareholders happy, too.

Since the stock has added €57m 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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We don't think that Ðuro Ðakovic Grupa d.d's modest trailing twelve month profit has the market's full attention at the moment. We think revenue is probably a better guide. As a general rule, we think this kind of company is more comparable to loss-making stocks, since the actual profit is so low. It would be hard to believe in a more profitable future without growing revenues.

Over the last twelve months, Ðuro Ðakovic Grupa d.d's revenue grew by 22%. We respect that sort of growth, no doubt. Arguably it's more than reflected in the truly wondrous share price gain of 328% in the last year. We're always cautious when the share price is up so much, but there's certainly enough revenue growth to justify taking a closer look at Ðuro Ðakovic Grupa d.d.

You can see how earnings and revenue have changed over time in the image below (click on the chart to see the exact values).

You can see how its balance sheet has strengthened (or weakened) over time in this free interactive graphic.

A Different Perspective

It's nice to see that Ðuro Ðakovic Grupa d.d shareholders have received a total shareholder return of 328% over the last year. Since the one-year TSR is better than the five-year TSR (the latter coming in at 4% 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 Ðuro Ðakovic Grupa d.d better, we need to consider many other factors. For instance, we've identified 2 warning signs for Ðuro Ðakovic Grupa d.d that you should be aware of.

But note: Ðuro Ðakovic Grupa d.d 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 Croatian 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.