Is Sambo Industrial's (KOSDAQ:009620) 130% Share Price Increase Well Justified?

When you buy shares in a company, there is always a risk that the price drops to zero. On the other hand, if you find a high quality business to buy (at the right price) you can more than double your money! For example, the Sambo Industrial Co., Ltd. (KOSDAQ:009620) share price has soared 130% in the last year. Most would be very happy with that, especially in just one year! Better yet, the share price has gained 133% in the last quarter. This could be related to the recent financial results, released recently - you can catch up on the most recent data by reading our company report. On the other hand, longer term shareholders have had a tougher run, with the stock falling 26% in three years.

See our latest analysis for Sambo Industrial

Because Sambo Industrial 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. Shareholders of unprofitable companies usually expect strong 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 Sambo Industrial saw its revenue shrink by 7.5%. We're a little surprised to see the share price pop 130% in the last year. It just goes to show the market doesn't always pay attention to the reported numbers. It's quite likely the revenue fall was already priced in, anyway.

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

If you are thinking of buying or selling Sambo Industrial stock, you should check out this FREE detailed report on its balance sheet.

A Different Perspective

It's nice to see that Sambo Industrial shareholders have received a total shareholder return of 130% over the last year. There's no doubt those recent returns are much better than the TSR loss of 4% 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 Sambo Industrial better, we need to consider many other factors. Case in point: We've spotted 4 warning signs for Sambo Industrial you should be aware of, and 1 of them is concerning.

Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of companies we expect will grow earnings.

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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