It might be of some concern to shareholders to see the Samko Timber Limited (SGX:E6R) share price down 30% in the last month. But that doesn't detract from the splendid returns of the last year. We're very pleased to report the share price shot up 217% in that time. So some might not be surprised to see the price retrace some. Only time will tell if there is still too much optimism currently reflected in the share price.
Because Samko Timber 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.
Samko Timber actually shrunk its revenue over the last year, with a reduction of 19%. So we would not have expected the share price to rise 217%. It just goes to show the market doesn't always pay attention to the reported numbers. It's quite likely the revenue fall was already priced in, anyway.
The image below shows how earnings and revenue have tracked over time (if you click on the image you can see greater detail).
Balance sheet strength is crucial. It might be well worthwhile taking a look at our free report on how its financial position has changed over time.
A Different Perspective
It's good to see that Samko Timber has rewarded shareholders with a total shareholder return of 217% in the last twelve months. That certainly beats the loss of about 9% 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 Samko Timber better, we need to consider many other factors. For example, we've discovered 3 warning signs for Samko Timber that you should be aware of before investing here.
If you are like me, then you will not want to miss this free list of growing companies that insiders are buying.
Please note, the market returns quoted in this article reflect the market weighted average returns of stocks that currently trade on SG exchanges.
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