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The most you can lose on any stock (assuming you don't use leverage) is 100% of your money. But on the bright side, if you buy shares in a high quality company at the right price, you can gain well over 100%. For instance, the price of Maiden Holdings, Ltd. (NASDAQ:MHLD) stock is up an impressive 177% over the last five years. Better yet, the share price has risen 21% in the last week.
On the back of a solid 7-day performance, let's check what role the company's fundamentals have played in driving long term shareholder returns.
Check out our latest analysis for Maiden Holdings
Given that Maiden Holdings 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. Some companies are willing to postpone profitability to grow revenue faster, but in that case one would hope for good top-line growth to make up for the lack of earnings.
Over the last half decade Maiden Holdings' revenue has actually been trending down at about 63% per year. On the other hand, the share price done the opposite, gaining 23%, compound, each year. It just goes to show tht the market is forward looking, and it's not always easy to predict the future based on past trends. Still, we are a bit cautious in this kind of situation.
The company's revenue and earnings (over time) are depicted in the image below (click to see the exact numbers).
This free interactive report on Maiden Holdings' balance sheet strength is a great place to start, if you want to investigate the stock further.
A Different Perspective
Maiden Holdings shareholders gained a total return of 23% during the year. But that was short of the market average. On the bright side, that's still a gain, and it's actually better than the average return of 23% over half a decade This suggests the company might be improving over time. Before spending more time on Maiden Holdings it might be wise to click here to see if insiders have been buying or selling shares.
If you like to buy stocks alongside management, then you might just love this free list of companies. (Hint: many of them are unnoticed AND have attractive valuation).
Please note, the market returns quoted in this article reflect the market weighted average returns of stocks that currently trade on American 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.