Introducing Clal Biotechnology Industries (TLV:CBI), The Stock That Zoomed 121% In The Last Year

When you buy shares in a company, there is always a risk that the price drops to zero. But when you pick a company that is really flourishing, you can make more than 100%. For example, the Clal Biotechnology Industries Ltd. (TLV:CBI) share price had more than doubled in just one year - up 121%. On top of that, the share price is up 34% in about a quarter. But this could be related to the strong market, which is up 14% in the last three months. On the other hand, longer term shareholders have had a tougher run, with the stock falling 33% in three years.

See our latest analysis for Clal Biotechnology Industries

Given that Clal Biotechnology Industries 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. Generally speaking, companies without profits are expected to grow revenue every year, and at a good clip. That's because it's hard to be confident a company will be sustainable if revenue growth is negligible, and it never makes a profit.

Clal Biotechnology Industries actually shrunk its revenue over the last year, with a reduction of 27%. So we would not have expected the share price to rise 121%. This is a good example of how buyers can push up prices even before the fundamental metrics show much growth. Of course, it could be that the market expected this revenue drop.

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

This free interactive report on Clal Biotechnology Industries' balance sheet strength is a great place to start, if you want to investigate the stock further.

A Different Perspective

It's nice to see that Clal Biotechnology Industries shareholders have received a total shareholder return of 121% over the last year. That certainly beats the loss of about 6% per year over the last half decade. The long term loss makes us cautious, but the short term TSR gain certainly hints at a brighter future. It's always interesting to track share price performance over the longer term. But to understand Clal Biotechnology Industries better, we need to consider many other factors. For example, we've discovered 1 warning sign for Clal Biotechnology Industries that you should be aware of before investing here.

If you are like me, then you will not want to miss this free list of growing companies that insiders are buying.

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