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Can You Imagine How Southeast CementLtd's (TPE:1110) Shareholders Feel About The 30% Share Price Increase?
The main point of investing for the long term is to make money. Better yet, you'd like to see the share price move up more than the market average. But Southeast Cement Co.,Ltd. (TPE:1110) has fallen short of that second goal, with a share price rise of 30% over five years, which is below the market return. Zooming in, the stock is up just 4.4% in the last year.
View our latest analysis for Southeast CementLtd
Southeast CementLtd wasn't profitable in the last twelve months, it is unlikely we'll see a strong correlation between its share price and its earnings per share (EPS). Arguably revenue is our next best option. 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.
In the last 5 years Southeast CementLtd saw its revenue shrink by 1.6% per year. The stock is only up 5% for each year during the period. That's pretty decent given the top line decline, and lack of profits. Of course, a closer look at the bottom line - and any available analyst forecasts - could reveal an opportunity (if they point to future growth).
You can see how earnings and revenue have changed over time in the image below (click on the chart to see the exact values).
This free interactive report on Southeast CementLtd's balance sheet strength is a great place to start, if you want to investigate the stock further.
What About Dividends?
When looking at investment returns, it is important to consider the difference between total shareholder return (TSR) and share price return. Whereas the share price return only reflects the change in the share price, the TSR includes the value of dividends (assuming they were reinvested) and the benefit of any discounted capital raising or spin-off. Arguably, the TSR gives a more comprehensive picture of the return generated by a stock. We note that for Southeast CementLtd the TSR over the last 5 years was 35%, which is better than the share price return mentioned above. And there's no prize for guessing that the dividend payments largely explain the divergence!
A Different Perspective
Southeast CementLtd shareholders gained a total return of 5.0% during the year. Unfortunately this falls short of the market return. It's probably a good sign that the company has an even better long term track record, having provided shareholders with an annual TSR of 6% over five years. It may well be that this is a business worth popping on the watching, given the continuing positive reception, over time, from the market. It's always interesting to track share price performance over the longer term. But to understand Southeast CementLtd better, we need to consider many other factors. To that end, you should be aware of the 1 warning sign we've spotted with Southeast CementLtd .
Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of companies we expect will 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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About TWSE:1110
Excellent balance sheet with poor track record.