Gilston Group (HKG:2011) shareholder returns have been stellar, earning 121% in 3 years
Gilston Group (HKG:2011) has seen a remarkable 121% increase in share price over the past three years, with a recent 12% rise in the last month. The company became profitable within this period, contributing to its strong performance. Despite a 12% gain this year, it lags behind the market average. Investors should be aware of potential risks, as one warning sign has been identified. Overall, while the stock shows promise, it may not be the best investment choice currently.
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%. To wit, the Gilston Group Limited (HKG:2011) share price has flown 121% in the last three years. Most would be happy with that. In more good news, the share price has risen 12% in thirty days.
Since it's been a strong week for Gilston Group shareholders, let's have a look at trend of the longer term fundamentals.
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To quote Buffett, 'Ships will sail around the world but the Flat Earth Society will flourish. There will continue to be wide discrepancies between price and value in the marketplace...' One imperfect but simple way to consider how the market perception of a company has shifted is to compare the change in the earnings per share (EPS) with the share price movement.
Gilston Group became profitable within the last three years. That kind of transition can be an inflection point that justifies a strong share price gain, just as we have seen here.
You can see below how EPS has changed over time (discover the exact values by clicking on the image).
Dive deeper into Gilston Group's key metrics by checking this interactive graph of Gilston Group's earnings, revenue and cash flow.
A Different Perspective
Gilston Group shareholders are up 12% for the year. But that return falls short of the market. On the bright side, that's still a gain, and it is certainly better than the yearly loss of about 7% endured over half a decade. So this might be a sign the business has turned its fortunes around. 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. Consider for instance, the ever-present spectre of investment risk. We've identified 1 warning sign with Gilston Group , and understanding them should be part of your investment process.
But note: Gilston Group may not be the best stock to buy. So take a peek at this free list of interesting companies with past earnings growth (and further growth forecast).
Please note, the market returns quoted in this article reflect the market weighted average returns of stocks that currently trade on Hong Kong exchanges.
