If You Had Bought Yulon Motor (TPE:2201) Shares A Year Ago You'd Have Earned 45% Returns

If you want to compound wealth in the stock market, you can do so by buying an index fund. But one can do better than that by picking better than average stocks (as part of a diversified portfolio). For example, the Yulon Motor Company Ltd. (TPE:2201) share price is up 45% in the last year, clearly besting the market return of around 35% (not including dividends). That's a solid performance by our standards! The longer term returns have not been as good, with the stock price only 11% higher than it was three years ago.

See our latest analysis for Yulon Motor

Given that Yulon Motor 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. Some companies are willing to postpone profitability to grow revenue faster, but in that case one does expect good top-line growth.

In the last year Yulon Motor saw its revenue shrink by 3.8%. Despite the lack of revenue growth, the stock has returned a solid 45% the last twelve months. To us that means that there isn't a lot of correlation between the past revenue performance and the share price, but a closer look at analyst forecasts and the bottom line may well explain a lot.

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

Take a more thorough look at Yulon Motor's financial health with this free report on its balance sheet.

A Different Perspective

It's nice to see that Yulon Motor shareholders have received a total shareholder return of 45% over the last year. Since the one-year TSR is better than the five-year TSR (the latter coming in at 0.1% per year), it would seem that the stock's performance has improved in recent times. Given the share price momentum remains strong, it might be worth taking a closer look at the stock, lest you miss an opportunity. It's always interesting to track share price performance over the longer term. But to understand Yulon Motor better, we need to consider many other factors. For example, we've discovered 1 warning sign for Yulon Motor that you should be aware of before investing here.

If you would prefer to check out another company -- one with potentially superior financials -- then do not miss this free list of companies that have proven they can grow earnings.

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