Stock Analysis

The 11% return this week takes Bonei Hatichon Civil Engineering & Infrastructures' (TLV:BOTI) shareholders five-year gains to 984%

TASE:BOTI
Source: Shutterstock

Buying shares in the best businesses can build meaningful wealth for you and your family. While not every stock performs well, when investors win, they can win big. For example, the Bonei Hatichon Civil Engineering & Infrastructures Ltd. (TLV:BOTI) share price is up a whopping 961% in the last half decade, a handsome return for long term holders. And this is just one example of the epic gains achieved by some long term investors. Better yet, the share price has risen 11% in the last week. Anyone who held for that rewarding ride would probably be keen to talk about it.

On the back of a solid 7-day performance, let's check what role the company's fundamentals have played in driving long term shareholder returns.

Check out our latest analysis for Bonei Hatichon Civil Engineering & Infrastructures

While Bonei Hatichon Civil Engineering & Infrastructures made a small profit, in the last year, we think that the market is probably more focussed on the top line growth at the moment. As a general rule, we think this kind of company is more comparable to loss-making stocks, since the actual profit is so low. For shareholders to have confidence a company will grow profits significantly, it must grow revenue.

For the last half decade, Bonei Hatichon Civil Engineering & Infrastructures can boast revenue growth at a rate of 18% per year. Even measured against other revenue-focussed companies, that's a good result. Arguably, this is well and truly reflected in the strong share price gain of 60%(per year) over the same period. Despite the strong run, top performers like Bonei Hatichon Civil Engineering & Infrastructures have been known to go on winning for decades. On the face of it, this looks lke a good opportunity, although we note sentiment seems very positive already.

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

earnings-and-revenue-growth
TASE:BOTI Earnings and Revenue Growth August 12th 2024

Take a more thorough look at Bonei Hatichon Civil Engineering & Infrastructures' financial health with this free report on its balance sheet.

What About The Total Shareholder Return (TSR)?

Investors should note that there's a difference between Bonei Hatichon Civil Engineering & Infrastructures' total shareholder return (TSR) and its share price change, which we've covered above. The TSR is a return calculation that accounts for the value of cash dividends (assuming that any dividend received was reinvested) and the calculated value of any discounted capital raisings and spin-offs. We note that Bonei Hatichon Civil Engineering & Infrastructures' TSR, at 984% is higher than its share price return of 961%. When you consider it hasn't been paying a dividend, this data suggests shareholders have benefitted from a spin-off, or had the opportunity to acquire attractively priced shares in a discounted capital raising.

A Different Perspective

We're pleased to report that Bonei Hatichon Civil Engineering & Infrastructures shareholders have received a total shareholder return of 5.9% over one year. Having said that, the five-year TSR of 61% a year, is even better. Potential buyers might understandably feel they've missed the opportunity, but it's always possible business is still firing on all cylinders. 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. Case in point: We've spotted 4 warning signs for Bonei Hatichon Civil Engineering & Infrastructures you should be aware of, and 2 of them are a bit concerning.

For those who like to find winning investments this free list of undervalued 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 Israeli exchanges.

Valuation is complex, but we're here to simplify it.

Discover if Bonei Hatichon Civil Engineering & Infrastructures might be undervalued or overvalued with our detailed analysis, featuring fair value estimates, potential risks, dividends, insider trades, and its financial condition.

Access Free Analysis

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.

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.