The 11% return this week takes Axtel. de's (BMV:AXTELCPO) shareholders one-year gains to 108%

Unfortunately, investing is risky - companies can and do go bankrupt. But if you pick the right business to buy shares in, you can make more than you can lose. For example, the Axtel, S.A.B. de C.V. (BMV:AXTELCPO) share price had more than doubled in just one year - up 108%. And in the last week the share price has popped 11%. Looking back further, the stock price is 54% higher than it was three years ago.

After a strong gain in the past week, it's worth seeing if longer term returns have been driven by improving fundamentals.

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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 Axtel. de grew its earnings per share, moving from a loss to a profit.

The company was close to break-even last year, so earnings per share of Mex$0.14 isn't particularly stand out. But judging by the share price, the market is very pleased with the milestone of reaching profitability. Inflection points like this can be a great time to take a closer look at a company.

You can see how EPS has changed over time in the image below (click on the chart to see the exact values).

We know that Axtel. de has improved its bottom line over the last three years, but what does the future have in store? Take a more thorough look at Axtel. de's financial health with this free report on its balance sheet.

A Different Perspective

We're pleased to report that Axtel. de shareholders have received a total shareholder return of 108% over one year. That certainly beats the loss of about 11% per year over the last half decade. 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 Axtel. de better, we need to consider many other factors. For instance, we've identified 2 warning signs for Axtel. de (1 shouldn't be ignored) that you should be aware of.

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Please note, the market returns quoted in this article reflect the market weighted average returns of stocks that currently trade on Mexican exchanges.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. 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.