Investors ignore increasing losses at Central Global Berhad (KLSE:CGB) as stock jumps 31% this past week

Long term investing can be life changing when you buy and hold the truly great businesses. And highest quality companies can see their share prices grow by huge amounts. To wit, the Central Global Berhad (KLSE:CGB) share price has soared 708% over five years. And this is just one example of the epic gains achieved by some long term investors. Better yet, the share price has risen 31% in the last week. This could be related to the recent financial results, released less than a week ago -- you can catch up on the most recent data by reading our company report. It really delights us to see such great share price performance for investors.

Since it's been a strong week for Central Global Berhad shareholders, let's have a look at trend of the longer term fundamentals.

See our latest analysis for Central Global Berhad

Central Global 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. When a company doesn't make profits, we'd generally hope to see good revenue growth. That's because fast revenue growth can be easily extrapolated to forecast profits, often of considerable size.

For the last half decade, Central Global Berhad can boast revenue growth at a rate of 17% per year. That's well above most pre-profit companies. Arguably, this is well and truly reflected in the strong share price gain of 52%(per year) over the same period. Despite the strong run, top performers like Central Global Berhad have been known to go on winning for decades. On the face of it, this looks lke a good opportunity, although we note sentiment seems very positive already.

You can see how earnings and revenue have changed over time in the image below (click on the chart to see the exact values).

This free interactive report on Central Global Berhad's balance sheet strength is a great place to start, if you want to investigate the stock further.

A Different Perspective

It's nice to see that Central Global Berhad shareholders have received a total shareholder return of 84% over the last year. Since the one-year TSR is better than the five-year TSR (the latter coming in at 52% per year), it would seem that the stock's performance has improved in recent times. Given the share price momentum remains strong, it might be worth taking a closer look at the stock, lest you miss an opportunity. 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 instance, we've identified 3 warning signs for Central Global Berhad (1 makes us a bit uncomfortable) that you should be aware of.

Of course Central Global Berhad may not be the best stock to buy. So you may wish to see this free collection of growth stocks.

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.