Investors Who Bought Marlborough Wine Estates Group (NZSE:MWE) Shares A Year Ago Are Now Up 71%

The simplest way to invest in stocks is to buy exchange traded funds. But you can significantly boost your returns by picking above-average stocks. For example, the Marlborough Wine Estates Group Limited (NZSE:MWE) share price is up 71% in the last year, clearly besting the market return of around 8.6% (not including dividends). If it can keep that out-performance up over the long term, investors will do very well! Marlborough Wine Estates Group hasn't been listed for long, so it's still not clear if it is a long term winner.

See our latest analysis for Marlborough Wine Estates Group

Given that Marlborough Wine Estates Group only made minimal earnings in the last twelve months, we'll focus on revenue to gauge its business development. Generally speaking, we'd consider a stock like this alongside loss-making companies, simply because the quantum of the profit is so low. For shareholders to have confidence a company will grow profits significantly, it must grow revenue.

Over the last twelve months, Marlborough Wine Estates Group's revenue grew by 19%. That's a fairly respectable growth rate. Buyers pushed the share price 71% in response, which isn't unreasonable. If revenue stays on trend, there may be plenty more share price gains to come. But it's crucial to check profitability and cash flow before forming a view on the future.

The image below shows how earnings and revenue have tracked over time (if you click on the image you can see greater detail).

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

A Different Perspective

It's nice to see that Marlborough Wine Estates Group shareholders have gained 71% over the last year. A substantial portion of that gain has come in the last three months, with the stock up 86% in that time. Demand for the stock from multiple parties is pushing the price higher; it could be that word is getting out about its virtues as a business. It's always interesting to track share price performance over the longer term. But to understand Marlborough Wine Estates Group better, we need to consider many other factors. To that end, you should be aware of the 4 warning signs we've spotted with Marlborough Wine Estates Group .

But note: Marlborough Wine Estates Group may not be the best stock to buy. So take a peek at this free list of interesting companies with past earnings growth (and further growth forecast).

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

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This article by Simply Wall St is general in nature. 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.
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