Shareholders Are Thrilled That The Hanmi Science (KRX:008930) Share Price Increased 100%

When you buy shares in a company, there is always a risk that the price drops to zero. But if you pick the right business to buy shares in, you can make more than you can lose. For example, the Hanmi Science Co., Ltd. (KRX:008930) share price has soared 100% return in just a single year. And in the last month, the share price has gained 18%. We note that Hanmi Science reported its financial results recently; luckily, you can catch up on the latest revenue and profit numbers in our company report. On the other hand, longer term shareholders have had a tougher run, with the stock falling 22% in three years.

Check out our latest analysis for Hanmi Science

Given that Hanmi Science only made minimal earnings in the last twelve months, we'll focus on revenue to gauge its business development. As a general rule, we think this kind of company is more comparable to loss-making stocks, since the actual profit is so low. For shareholders to have confidence a company will grow profits significantly, it must grow revenue.

In the last year Hanmi Science saw its revenue grow by 8.5%. That's not a very high growth rate considering it doesn't make profits. In contrast, the share price took off during the year, gaining 100%. The business will need a lot more growth to justify that increase. We're not so sure that revenue growth is driving the market optimism about the stock.

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

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

A Different Perspective

It's good to see that Hanmi Science has rewarded shareholders with a total shareholder return of 101% in the last twelve months. And that does include the dividend. There's no doubt those recent returns are much better than the TSR loss of 5% 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 Hanmi Science better, we need to consider many other factors. For example, we've discovered 2 warning signs for Hanmi Science (1 can't be ignored!) that you should be aware of before investing here.

If you would prefer to check out another company -- one with potentially superior financials -- then do not miss this free list of companies that have proven they can 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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