Stock Analysis

Doosan Heavy Industries & Construction (KRX:034020) Has Gifted Shareholders With A Fantastic 300% Total Return On Their Investment

KOSE:A034020
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While Doosan Heavy Industries & Construction Co., Ltd. (KRX:034020) shareholders are probably generally happy, the stock hasn't had particularly good run recently, with the share price falling 16% in the last quarter. But that doesn't change the fact that the returns over the last year have been very strong. Like an eagle, the share price soared 275% in that time. So we think most shareholders won't be too upset about the recent fall. Investors should be wondering whether the business itself has the fundamental value required to continue to drive gains.

Check out our latest analysis for Doosan Heavy Industries & Construction

Given that Doosan Heavy Industries & Construction 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 it's hard to be confident a company will be sustainable if revenue growth is negligible, and it never makes a profit.

In the last year Doosan Heavy Industries & Construction saw its revenue grow by 0.3%. That's not a very high growth rate considering it doesn't make profits. So we wouldn't have expected the share price to rise by 275%. The business will need a lot more growth to justify that increase. It's quite likely that the market is considering other factors, not just revenue growth.

The graphic below depicts how earnings and revenue have changed over time (unveil the exact values by clicking on the image).

earnings-and-revenue-growth
KOSE:A034020 Earnings and Revenue Growth March 17th 2021

If you are thinking of buying or selling Doosan Heavy Industries & Construction stock, you should check out this FREE detailed report on its balance sheet.

What about the Total Shareholder Return (TSR)?

Investors should note that there's a difference between Doosan Heavy Industries & Construction'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. Its history of dividend payouts mean that Doosan Heavy Industries & Construction's TSR of 300% over the last year is better than the share price return.

A Different Perspective

It's nice to see that Doosan Heavy Industries & Construction shareholders have received a total shareholder return of 300% over the last year. There's no doubt those recent returns are much better than the TSR loss of 6% per year over five years. This makes us a little wary, but the business might have turned around its fortunes. It's always interesting to track share price performance over the longer term. But to understand Doosan Heavy Industries & Construction better, we need to consider many other factors. For example, we've discovered 3 warning signs for Doosan Heavy Industries & Construction (2 shouldn't be ignored!) that you should be aware of before investing here.

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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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