In This Article:
Some stocks are best avoided. We really hate to see fellow investors lose their hard-earned money. Anyone who held China Kingstone Mining Holdings Limited (HKG:1380) for five years would be nursing their metaphorical wounds since the share price dropped 96% in that time.
We really feel for shareholders in this scenario. It's a good reminder of the importance of diversification, and it's worth keeping in mind there's more to life than money, anyway.
Check out our latest analysis for China Kingstone Mining Holdings
Given that China Kingstone Mining 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. When a company doesn't make profits, we'd generally expect to see good revenue growth. As you can imagine, fast revenue growth, when maintained, often leads to fast profit growth.
In the last half decade, China Kingstone Mining Holdings saw its revenue increase by 46% per year. That's better than most loss-making companies. So on the face of it we're really surprised to see the share price has averaged a fall of 47% each year, in the same time period. It could be that the stock was over-hyped before. While there might be an opportunity here, you'd want to take a close look at the balance sheet strength.
You can see below how earnings and revenue have changed over time (discover the exact values by clicking on the image).
You can see how its balance sheet has strengthened (or weakened) over time in this free interactive graphic.
What about the Total Shareholder Return (TSR)?
Investors should note that there's a difference between China Kingstone Mining Holdings's total shareholder return (TSR) and its share price change, which we've covered above. The TSR is a return calculation that accounts for the value of cash dividends (assuming that any dividend received was reinvested) and the calculated value of any discounted capital raisings and spin-offs. We note that China Kingstone Mining Holdings's TSR, at -94% is higher than its share price return of -96%. When you consider it hasn't been paying a dividend, this data suggests shareholders have benefitted from a spin-off, or had the opportunity to acquire attractively priced shares in a discounted capital raising.
A Different Perspective
We're pleased to report that China Kingstone Mining Holdings shareholders have received a total shareholder return of 54% over one year. There's no doubt those recent returns are much better than the TSR loss of 43% per year over five years. The long term loss makes us cautious, but the short term TSR gain certainly hints at a brighter future. You could get a better understanding of China Kingstone Mining Holdings's growth by checking out this more detailed historical graph of earnings, revenue and cash flow.