Can You Imagine How Chuffed Diebold Nixdorf's (NYSE:DBD) Shareholders Feel About Its 201% Share Price Gain?
When you buy shares in a company, there is always a risk that the price drops to zero. But if you pick the right stock, you can make a lot more than 100%. Take, for example Diebold Nixdorf, Incorporated (NYSE:DBD). Its share price is already up an impressive 201% in the last twelve months. It's also up 56% in about a month. On the other hand, longer term shareholders have had a tougher run, with the stock falling 53% in three years.
Check out our latest analysis for Diebold Nixdorf
Because Diebold Nixdorf 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. Shareholders of unprofitable companies usually expect strong revenue growth. That's because fast revenue growth can be easily extrapolated to forecast profits, often of considerable size.
Over the last twelve months, Diebold Nixdorf's revenue grew by 0.2%. That's not great considering the company is losing money. In contrast, the share price took off during the year, gaining 201%. We're happy that investors have made money, though we wonder if the increase will be sustained. It's quite likely that the market is considering other factors, not just revenue growth.
The image below shows how earnings and revenue have tracked over time (if you click on the image you can see greater detail).
It's good to see that there was some significant insider buying in the last three months. That's a positive. That said, we think earnings and revenue growth trends are even more important factors to consider. So it makes a lot of sense to check out what analysts think Diebold Nixdorf will earn in the future (free profit forecasts).
What about the Total Shareholder Return (TSR)?
We'd be remiss not to mention the difference between Diebold Nixdorf's total shareholder return (TSR) and its share price return. Arguably the TSR is a more complete return calculation because it accounts for the value of dividends (as if they were reinvested), along with the hypothetical value of any discounted capital that have been offered to shareholders. Its history of dividend payouts mean that Diebold Nixdorf's TSR of 201% over the last year is better than the share price return.
A Different Perspective
It's nice to see that Diebold Nixdorf shareholders have received a total shareholder return of 201% over the last year. There's no doubt those recent returns are much better than the TSR loss of 16% per year over five years. The long term loss makes us cautious, but the short term TSR gain certainly hints at a brighter future. It is all well and good that insiders have been buying shares, but we suggest you check here to see what price insiders were buying at.
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 US exchanges.
If you spot an error that warrants correction, please contact the editor at editorial-team@simplywallst.com. 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. Simply Wall St has no position in the stocks mentioned.
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