If You Had Bought Dongkuk Steel Mill (KRX:001230) Stock A Year Ago, You Could Pocket A 213% Gain Today

When you buy shares in a company, there is always a risk that the price drops to zero. But if you pick the right stock, you can make a lot more than 100%. For example, the Dongkuk Steel Mill Company Limited (KRX:001230) share price has soared 213% return in just a single year. It's also good to see the share price up 35% over the last quarter. The longer term returns have not been as good, with the stock price only 11% higher than it was three years ago.

Check out our latest analysis for Dongkuk Steel Mill

Dongkuk Steel Mill isn't currently profitable, so most analysts would look to revenue growth to get an idea of how fast the underlying business is growing. Shareholders of unprofitable companies usually expect strong revenue growth. Some companies are willing to postpone profitability to grow revenue faster, but in that case one does expect good top-line growth.

In the last year Dongkuk Steel Mill saw its revenue shrink by 11%. We're a little surprised to see the share price pop 213% 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.

The image below shows how earnings and revenue have tracked over time (if you click on the image you can see greater detail).

Take a more thorough look at Dongkuk Steel Mill's financial health with this free report on its balance sheet.

What about the Total Shareholder Return (TSR)?

Investors should note that there's a difference between Dongkuk Steel Mill's total shareholder return (TSR) and its share price change, which we've covered above. The TSR is a return calculation that accounts for the value of cash dividends (assuming that any dividend received was reinvested) and the calculated value of any discounted capital raisings and spin-offs. Its history of dividend payouts mean that Dongkuk Steel Mill's TSR of 221% over the last year is better than the share price return.

A Different Perspective

It's nice to see that Dongkuk Steel Mill shareholders have received a total shareholder return of 221% over the last year. That's better than the annualised return of 12% over half a decade, implying that the company is doing better recently. Someone with an optimistic perspective could view the recent improvement in TSR as indicating that the business itself is getting better with time. It's always interesting to track share price performance over the longer term. But to understand Dongkuk Steel Mill better, we need to consider many other factors. Take risks, for example - Dongkuk Steel Mill has 1 warning sign we think you should be aware of.

If you like to buy stocks alongside management, then you might just love this free list of companies. (Hint: insiders have been buying them).

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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