It's nice to see the WCT Holdings Berhad (KLSE:WCT) share price up 11% in a week. But that is little comfort to those holding over the last half decade, sitting on a big loss. The share price has failed to impress anyone , down a sizable 63% during that time. So we're hesitant to put much weight behind the short term increase. But it could be that the fall was overdone.
Because WCT Holdings Berhad 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. As you can imagine, fast revenue growth, when maintained, often leads to fast profit growth.
In the last five years WCT Holdings Berhad saw its revenue shrink by 1.8% per year. That's not what investors generally want to see. The share price decline of 10% compound, over five years, is understandable given the company is losing money, and revenue is moving in the wrong direction. We don't think anyone is rushing to buy this stock. Not that many investors like to invest in companies that are losing money and not growing revenue.
You can see below how earnings and revenue have changed over time (discover the exact values by clicking on the image).
WCT Holdings Berhad is a well known stock, with plenty of analyst coverage, suggesting some visibility into future growth. So we recommend checking out this free report showing consensus forecasts
A Different Perspective
It's nice to see that WCT Holdings Berhad shareholders have received a total shareholder return of 20% over the last year. That certainly beats the loss of about 10% per year over the last half decade. 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 WCT Holdings Berhad better, we need to consider many other factors. For instance, we've identified 1 warning sign for WCT Holdings Berhad that you should be aware of.
For those who like to find winning investments this free list of growing companies with recent insider purchasing, could be just the ticket.
Please note, the market returns quoted in this article reflect the market weighted average returns of stocks that currently trade on MY exchanges.
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