Reflecting on Elementia. de's (BMV:ELEMENT) Share Price Returns Over The Last Three Years

While not a mind-blowing move, it is good to see that the Elementia, S.A.B. de C.V. (BMV:ELEMENT) share price has gained 29% in the last three months. Meanwhile over the last three years the stock has dropped hard. Regrettably, the share price slid 54% in that period. Some might say the recent bounce is to be expected after such a bad drop. While many would remain nervous, there could be further gains if the business can put its best foot forward.

Check out our latest analysis for Elementia. de

Because Elementia. de 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. 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 three years, Elementia. de saw its revenue grow by 2.0% per year, compound. That's not a very high growth rate considering it doesn't make profits. This uninspiring revenue growth has no doubt helped send the share price lower; it dropped 16% during the period. When a stock falls hard like this, some investors like to add the company to a watchlist (in case the business recovers, longer term). After all, growing a business isn't easy, and the process will not always be smooth.

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 Elementia. de's financial health with this free report on its balance sheet.

A Different Perspective

It's nice to see that Elementia. de shareholders have received a total shareholder return of 17% over the last year. There's no doubt those recent returns are much better than the TSR loss of 7% per year over five years. This makes us a little wary, but the business might have turned around its fortunes. It's always interesting to track share price performance over the longer term. But to understand Elementia. de better, we need to consider many other factors. Case in point: We've spotted 2 warning signs for Elementia. de you should be aware of, and 1 of them makes us a bit uncomfortable.

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 MX 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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