Paragon Globe Berhad (KLSE:PGLOBE) adds RM37m to market cap in the past 7 days, though investors from three years ago are still down 22%

Paragon Globe Berhad (KLSE:PGLOBE) shareholders will doubtless be very grateful to see the share price up 36% in the last month. But that doesn't help the fact that the three year return is less impressive. After all, the share price is down 73% in the last three years, significantly under-performing the market.

The recent uptick of 21% could be a positive sign of things to come, so let's take a look at historical fundamentals.

Check out our latest analysis for Paragon Globe Berhad

Paragon Globe Berhad isn't currently profitable, so most analysts would look to revenue growth to get an idea of how fast the underlying business is growing. Generally speaking, companies without profits are expected to grow revenue every year, and at a good clip. As you can imagine, fast revenue growth, when maintained, often leads to fast profit growth.

In the last three years, Paragon Globe Berhad saw its revenue grow by 11% per year, compound. That's a pretty good rate of top-line growth. So it's hard to believe the share price decline of 20% per year is due to the revenue. It could be that the losses were much larger than expected. If you buy into companies that lose money then you always risk losing money yourself. Just don't lose the lesson.

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

Balance sheet strength is crucial. It might be well worthwhile taking a look at our free report on how its financial position has changed over time.

What About The Total Shareholder Return (TSR)?

Investors should note that there's a difference between Paragon Globe Berhad's total shareholder return (TSR) and its share price change, which we've covered above. The TSR attempts to capture the value of dividends (as if they were reinvested) as well as any spin-offs or discounted capital raisings offered to shareholders. Its history of dividend payouts mean that Paragon Globe Berhad's TSR, which was a 22% drop over the last 3 years, was not as bad as the share price return.

A Different Perspective

It's good to see that Paragon Globe Berhad has rewarded shareholders with a total shareholder return of 68% in the last twelve months. That certainly beats the loss of about 3% per year over the last half decade. This makes us a little wary, but the business might have turned around its fortunes. I find it very interesting to look at share price over the long term as a proxy for business performance. But to truly gain insight, we need to consider other information, too. For example, we've discovered 3 warning signs for Paragon Globe Berhad (1 is a bit concerning!) that you should be aware of before investing here.

If you are like me, then you will not want to miss this free list of growing companies that insiders are buying.

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