Shareholders Are Thrilled That The Creative Technology (SGX:C76) Share Price Increased 147%

The most you can lose on any stock (assuming you don't use leverage) is 100% of your money. But on the bright side, if you buy shares in a high quality company at the right price, you can gain well over 100%. For example, the Creative Technology Ltd (SGX:C76) share price has soared 147% in the last half decade. Most would be very happy with that. Also pleasing for shareholders was the 12% gain in the last three months. But this could be related to the strong market, which is up 5.4% in the last three months.

See our latest analysis for Creative Technology

Given that Creative Technology didn't make a profit in the last twelve months, we'll focus on revenue growth to form a quick view of its business development. Shareholders of unprofitable companies usually expect strong 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 5 years Creative Technology saw its revenue shrink by 7.2% per year. On the other hand, the share price done the opposite, gaining 20%, compound, each year. It's a good reminder that expectations about the future, not the past history, always impact share prices. Still, we are a bit cautious in this kind of situation.

You can see below how earnings and revenue have changed over time (discover the exact values by clicking on the image).

If you are thinking of buying or selling Creative Technology stock, you should check out this FREE detailed report on its balance sheet.

A Different Perspective

Creative Technology shareholders are down 6.3% over twelve months, which isn't far from the market return of -5.8%. Longer term investors wouldn't be so upset, since they would have made 20%, each year, over five years. If the fundamental data remains strong, and the share price is simply down on sentiment, then this could be an opportunity worth investigating. While it is well worth considering the different impacts that market conditions can have on the share price, there are other factors that are even more important. Consider risks, for instance. Every company has them, and we've spotted 1 warning sign for Creative Technology you should know about.

But note: Creative Technology 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 SG 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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