The DAIHAN Scientific (KOSDAQ:131220) Share Price Has Gained 173%, So Why Not Pay It Some Attention?

The last three months have been tough on DAIHAN Scientific Co., Ltd. (KOSDAQ:131220) shareholders, who have seen the share price decline a rather worrying 49%. Despite this, the stock is a strong performer over the last year, no doubt about that. Like an eagle, the share price soared 173% in that time. So some might not be surprised to see the price retrace some. The real question is whether the business is trending in the right direction.

Check out our latest analysis for DAIHAN Scientific

To quote Buffett, 'Ships will sail around the world but the Flat Earth Society will flourish. There will continue to be wide discrepancies between price and value in the marketplace...' One imperfect but simple way to consider how the market perception of a company has shifted is to compare the change in the earnings per share (EPS) with the share price movement.

During the last year, DAIHAN Scientific actually saw its earnings per share drop 12%.

Given the share price gain, we doubt the market is measuring progress with EPS. Indeed, when EPS is declining but the share price is up, it often means the market is considering other factors.

We doubt the modest 0.4% dividend yield is doing much to support the share price. However the year on year revenue growth of 10% would help. We do see some companies suppress earnings in order to accelerate revenue growth.

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

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

A Different Perspective

It's good to see that DAIHAN Scientific has rewarded shareholders with a total shareholder return of 174% in the last twelve months. Of course, that includes the dividend. That gain is better than the annual TSR over five years, which is 9%. Therefore it seems like sentiment around the company has been positive lately. In the best case scenario, this may hint at some real business momentum, implying that now could be a great time to delve deeper. While it is well worth considering the different impacts that market conditions can have on the share price, there are other factors that are even more important. To that end, you should be aware of the 2 warning signs we've spotted with DAIHAN Scientific .

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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