If You Had Bought Evergreen Fibreboard Berhad's (KLSE:EVERGRN) Shares Five Years Ago You Would Be Down 70%

Evergreen Fibreboard Berhad (KLSE:EVERGRN) shareholders will doubtless be very grateful to see the share price up 47% in the last quarter. But that is little comfort to those holding over the last half decade, sitting on a big loss. In fact, the share price has declined rather badly, down some 70% in that time. So we're hesitant to put much weight behind the short term increase. But it could be that the fall was overdone.

See our latest analysis for Evergreen Fibreboard Berhad

Because Evergreen Fibreboard 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. Generally speaking, companies without profits are expected to grow revenue every year, and at a good clip. Some companies are willing to postpone profitability to grow revenue faster, but in that case one does expect good top-line growth.

Over half a decade Evergreen Fibreboard Berhad reduced its trailing twelve month revenue by 1.1% for each year. While far from catastrophic that is not good. With neither profit nor revenue growth, the loss of 11% per year doesn't really surprise us. The chance of imminent investor enthusiasm for this stock seems slimmer than Louise Brooks. Not that many investors like to invest in companies that are losing money and not growing revenue.

The graphic below depicts how earnings and revenue have changed over time (unveil the exact values by clicking on the image).

You can see how its balance sheet has strengthened (or weakened) over time in this free interactive graphic.

What about the Total Shareholder Return (TSR)?

We'd be remiss not to mention the difference between Evergreen Fibreboard Berhad's total shareholder return (TSR) and its share price return. Arguably the TSR is a more complete return calculation because it accounts for the value of dividends (as if they were reinvested), along with the hypothetical value of any discounted capital that have been offered to shareholders. Dividends have been really beneficial for Evergreen Fibreboard Berhad shareholders, and that cash payout explains why its total shareholder loss of 68%, over the last 5 years, isn't as bad as the share price return.

A Different Perspective

It's nice to see that Evergreen Fibreboard Berhad shareholders have received a total shareholder return of 53% over the last year. Notably the five-year annualised TSR loss of 11% per year compares very unfavourably with the recent share price performance. The long term loss makes us cautious, but the short term TSR gain certainly hints at a brighter future. 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. Take risks, for example - Evergreen Fibreboard Berhad has 2 warning signs we think you should be aware of.

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 MY exchanges.

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