The 17% return this week takes Sadbhav Engineering's (NSE:SADBHAV) shareholders one-year gains to 118%

When you buy shares in a company, there is always a risk that the price drops to zero. But if you pick the right business to buy shares in, you can make more than you can lose. For example, the Sadbhav Engineering Limited (NSE:SADBHAV) share price has soared 118% in the last 1 year. Most would be very happy with that, especially in just one year! Also pleasing for shareholders was the 50% gain in the last three months. The company reported its financial results recently; you can catch up on the latest numbers by reading our company report. Unfortunately the longer term returns are not so good, with the stock falling 64% in the last three years.

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

Check out our latest analysis for Sadbhav Engineering

Given that Sadbhav Engineering 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 expect to see good revenue growth. That's because fast revenue growth can be easily extrapolated to forecast profits, often of considerable size.

Sadbhav Engineering actually shrunk its revenue over the last year, with a reduction of 13%. So we would not have expected the share price to rise 118%. It just goes to show the market doesn't always pay attention to the reported numbers. Of course, it could be that the market expected this revenue drop.

You can see below how earnings and revenue have changed over time (discover the exact values by clicking on the image).

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

A Different Perspective

It's good to see that Sadbhav Engineering has rewarded shareholders with a total shareholder return of 118% in the last twelve months. There's no doubt those recent returns are much better than the TSR loss of 13% per year over five years. 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 Sadbhav Engineering better, we need to consider many other factors. For example, we've discovered 2 warning signs for Sadbhav Engineering (1 can't be ignored!) that you should be aware of before investing here.

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 Indian 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.