The PhytoHealth (TPE:4108) Share Price Has Gained 60% And Shareholders Are Hoping For More

If you want to compound wealth in the stock market, you can do so by buying an index fund. But investors can boost returns by picking market-beating companies to own shares in. For example, the PhytoHealth Corporation (TPE:4108) share price is up 60% in the last year, clearly besting the market return of around 26% (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 25% higher than it was three years ago.

View our latest analysis for PhytoHealth

Given that PhytoHealth 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 year PhytoHealth saw its revenue shrink by 30%. The stock is up 60% in that time, a fine performance given the revenue drop. 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.

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

This free interactive report on PhytoHealth's balance sheet strength is a great place to start, if you want to investigate the stock further.

A Different Perspective

We're pleased to report that PhytoHealth shareholders have received a total shareholder return of 60% over one year. Since the one-year TSR is better than the five-year TSR (the latter coming in at 3% per year), it would seem that the stock's performance has improved in recent times. In the best case scenario, this may hint at some real business momentum, implying that now could be a great time to delve deeper. I find it very interesting to look at share price over the long term as a proxy for business performance. But to truly gain insight, we need to consider other information, too. Case in point: We've spotted 1 warning sign for PhytoHealth you should be aware of.

If you like to buy stocks alongside management, then you might just love this free list of companies. (Hint: insiders have been buying them).

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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