The worst result, after buying shares in a company (assuming no leverage), would be if you lose all the money you put in. But when you pick a company that is really flourishing, you can make more than 100%. For instance the ShenZhen RoadRover Technology Co.,Ltd (SZSE:002813) share price is 106% higher than it was three years ago. Most would be happy with that. Also pleasing for shareholders was the 26% gain in the last three months.
The past week has proven to be lucrative for ShenZhen RoadRover TechnologyLtd investors, so let's see if fundamentals drove the company's three-year performance.
See our latest analysis for ShenZhen RoadRover TechnologyLtd
Given that ShenZhen RoadRover TechnologyLtd 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. Generally speaking, companies without profits are expected to grow revenue every year, and at a good clip. That's because fast revenue growth can be easily extrapolated to forecast profits, often of considerable size.
In the last 3 years ShenZhen RoadRover TechnologyLtd saw its revenue shrink by 25% per year. So the share price gain of 27% per year is quite surprising. It's a good reminder that expectations about the future, not the past history, always impact share prices.
The image below shows how earnings and revenue have tracked over time (if you click on the image you can see greater detail).
Take a more thorough look at ShenZhen RoadRover TechnologyLtd's financial health with this free report on its balance sheet.
A Different Perspective
It's good to see that ShenZhen RoadRover TechnologyLtd has rewarded shareholders with a total shareholder return of 50% in the last twelve months. That's better than the annualised return of 10% over half a decade, implying that the company is doing better recently. In the best case scenario, this may hint at some real business momentum, implying that now could be a great time to delve deeper. It's always interesting to track share price performance over the longer term. But to understand ShenZhen RoadRover TechnologyLtd better, we need to consider many other factors. For example, we've discovered 1 warning sign for ShenZhen RoadRover TechnologyLtd that you should be aware of before investing here.
For those who like to find winning investments this free list of growing companies with recent insider purchasing, could be just the ticket.
Please note, the market returns quoted in this article reflect the market weighted average returns of stocks that currently trade on Chinese exchanges.
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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. 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.
