Stock Analysis

Haitai Confectionery&Foodsltd's (KRX:101530) Shareholders Are Down 50% On Their Shares

KOSE:A101530
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As an investor its worth striving to ensure your overall portfolio beats the market average. But if you try your hand at stock picking, your risk returning less than the market. Unfortunately, that's been the case for longer term Haitai Confectionery&Foods Co.,ltd. (KRX:101530) shareholders, since the share price is down 50% in the last three years, falling well short of the market return of around 21%. The falls have accelerated recently, with the share price down 12% in the last three months. This could be related to the recent financial results - you can catch up on the most recent data by reading our company report.

View our latest analysis for Haitai Confectionery&Foodsltd

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.

Haitai Confectionery&Foodsltd has made a profit in the past. On the other hand, it reported a trailing twelve months loss, suggesting it isn't reliably profitable. Other metrics may better explain the share price move.

With a rather small yield of just 1.8% we doubt that the stock's share price is based on its dividend. Arguably the revenue decline of 4.9% per year has people thinking Haitai Confectionery&Foodsltd is shrinking. And that's not surprising, since it seems unlikely that EPS growth can continue for long in the absence of revenue growth.

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

earnings-and-revenue-growth
KOSE:A101530 Earnings and Revenue Growth December 11th 2020

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

What About Dividends?

As well as measuring the share price return, investors should also consider the total shareholder return (TSR). The TSR incorporates the value of any spin-offs or discounted capital raisings, along with any dividends, based on the assumption that the dividends are reinvested. It's fair to say that the TSR gives a more complete picture for stocks that pay a dividend. As it happens, Haitai Confectionery&Foodsltd's TSR for the last 3 years was -48%, which exceeds the share price return mentioned earlier. The dividends paid by the company have thusly boosted the total shareholder return.

A Different Perspective

Haitai Confectionery&Foodsltd produced a TSR of 17% over the last year. It's always nice to make money but this return falls short of the market return which was about 37% for the year. The silver lining is that the recent rise is far preferable to the annual loss of 14% that shareholders have suffered over the last three years. We hope the turnaround in fortunes continues. It's always interesting to track share price performance over the longer term. But to understand Haitai Confectionery&Foodsltd better, we need to consider many other factors. Like risks, for instance. Every company has them, and we've spotted 3 warning signs for Haitai Confectionery&Foodsltd (of which 2 can't be ignored!) you should know about.

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 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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