If You Had Bought Dong-A Hwa SungLtd (KOSDAQ:041930) Stock A Year Ago, You Could Pocket A 132% Gain Today

Unfortunately, investing is risky - companies can and do go bankrupt. But when you pick a company that is really flourishing, you can make more than 100%. Take, for example Dong-A Hwa Sung Co.,Ltd. (KOSDAQ:041930). Its share price is already up an impressive 132% in the last twelve months. We note the stock price is up 4.4% in the last seven days. It is also impressive that the stock is up 127% over three years, adding to the sense that it is a real winner.

Check out our latest analysis for Dong-A Hwa SungLtd

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.

Over the last twelve months, Dong-A Hwa SungLtd actually shrank its EPS by 55%.

This means it's unlikely the market is judging the company based on earnings growth. Therefore, it seems likely that investors are putting more weight on metrics other than EPS, at the moment.

We doubt the modest 0.5% dividend yield is doing much to support the share price. Dong-A Hwa SungLtd's revenue actually dropped 5.8% over last year. So using a snapshot of key business metrics doesn't give us a good picture of why the market is bidding up the stock.

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

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 Dong-A Hwa SungLtd shareholders have received a total shareholder return of 133% over the last year. Of course, that includes the dividend. That's better than the annualised return of 17% over half a decade, implying that the company is doing better recently. In the best case scenario, this may hint at some real business momentum, implying that now could be a great time to delve deeper. 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 3 warning signs for Dong-A Hwa SungLtd (1 is a bit unpleasant) that you should be aware of.

Of course Dong-A Hwa SungLtd may not be the best stock to buy. So you may wish to see this free collection of growth stocks.

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