Those who invested in Ecopro BM (KOSDAQ:247540) five years ago are up 437%

It hasn't been the best quarter for Ecopro BM. Co., Ltd. (KOSDAQ:247540) shareholders, since the share price has fallen 26% in that time. But that doesn't change the fact that the returns over the last half decade have been spectacular. To be precise, the stock price is 426% higher than it was five years ago, a wonderful performance by any measure. So we don't think the recent decline in the share price means its story is a sad one. Of course what matters most is whether the business can improve itself sustainably, thus justifying a higher price. While the long term returns are impressive, we do have some sympathy for those who bought more recently, given the 55% drop, in the last year.

Let's take a look at the underlying fundamentals over the longer term, and see if they've been consistent with shareholders returns.

We've discovered 2 warning signs about Ecopro BM. View them for free.

Because Ecopro BM made a loss in the last twelve months, we think the market is probably more focussed on revenue and revenue growth, at least for now. Generally speaking, companies without profits are expected to grow revenue every year, and at a good clip. As you can imagine, fast revenue growth, when maintained, often leads to fast profit growth.

In the last 5 years Ecopro BM saw its revenue grow at 38% per year. That's well above most pre-profit companies. Arguably, this is well and truly reflected in the strong share price gain of 39%(per year) over the same period. It's never too late to start following a top notch stock like Ecopro BM, since some long term winners go on winning for decades. On the face of it, this looks lke a good opportunity, although we note sentiment seems very positive already.

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

Ecopro BM is well known by investors, and plenty of clever analysts have tried to predict the future profit levels. So it makes a lot of sense to check out what analysts think Ecopro BM will earn in the future (free analyst consensus estimates)

What About The Total Shareholder Return (TSR)?

Investors should note that there's a difference between Ecopro BM's total shareholder return (TSR) and its share price change, which we've covered above. The TSR attempts to capture the value of dividends (as if they were reinvested) as well as any spin-offs or discounted capital raisings offered to shareholders. Ecopro BM's TSR of 437% for the 5 years exceeded its share price return, because it has paid dividends.

A Different Perspective

While the broader market lost about 5.7% in the twelve months, Ecopro BM shareholders did even worse, losing 55%. However, it could simply be that the share price has been impacted by broader market jitters. It might be worth keeping an eye on the fundamentals, in case there's a good opportunity. Longer term investors wouldn't be so upset, since they would have made 40%, each year, over five years. If the fundamental data continues to indicate long term sustainable growth, the current sell-off could be an opportunity worth considering. It's always interesting to track share price performance over the longer term. But to understand Ecopro BM better, we need to consider many other factors. Take risks, for example - Ecopro BM has 2 warning signs we think you should be aware of.

We will like Ecopro BM better if we see some big insider buys. While we wait, check out this free list of undervalued stocks (mostly small caps) with considerable, recent, insider buying.

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