How Much Did Wallenius Wilhelmsen's(OB:WAWI) Shareholders Earn From Share Price Movements Over The Last Three Years?

Wallenius Wilhelmsen ASA (OB:WAWI) shareholders will doubtless be very grateful to see the share price up 56% in the last quarter. But that is small recompense for the exasperating returns over three years. Tragically, the share price declined 62% in that time. So it's good to see it climbing back up. After all, could be that the fall was overdone.

Check out our latest analysis for Wallenius Wilhelmsen

Wallenius Wilhelmsen 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 expect to see good revenue growth. That's because it's hard to be confident a company will be sustainable if revenue growth is negligible, and it never makes a profit.

In the last three years, Wallenius Wilhelmsen saw its revenue grow by 3.8% per year, compound. That's not a very high growth rate considering it doesn't make profits. It's likely this weak growth has contributed to an annualised return of 18% for the last three years. When a stock falls hard like this, some investors like to add the company to a watchlist (in case the business recovers, longer term). Keep in mind it isn't unusual for good businesses to have a tough time or a couple of uninspiring years.

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

We like that insiders have been buying shares in the last twelve months. Even so, future earnings will be far more important to whether current shareholders make money. You can see what analysts are predicting for Wallenius Wilhelmsen in this interactive graph of future profit estimates.

A Different Perspective

Wallenius Wilhelmsen shareholders are down 14% for the year, but the market itself is up 4.3%. Even the share prices of good stocks drop sometimes, but we want to see improvements in the fundamental metrics of a business, before getting too interested. Regrettably, last year's performance caps off a bad run, with the shareholders facing a total loss of 5% per year over five years. We realise that Baron Rothschild has said investors should "buy when there is blood on the streets", but we caution that investors should first be sure they are buying a high quality business. 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. Like risks, for instance. Every company has them, and we've spotted 2 warning signs for Wallenius Wilhelmsen (of which 1 can't be ignored!) you should know about.

Wallenius Wilhelmsen is not the only stock that insiders are buying. 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 NO exchanges.

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