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Statistically speaking, long term investing is a profitable endeavour. But no-one is immune from buying too high. For example the Central Development Holdings Limited (HKG:475) share price dropped 59% over five years. We certainly feel for shareholders who bought near the top.
Check out our latest analysis for Central Development Holdings
Given that Central Development 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. As you can imagine, fast revenue growth, when maintained, often leads to fast profit growth.
Over five years, Central Development Holdings grew its revenue at 6.1% per year. That's a fairly respectable growth rate. The share price return isn't so respectable with an annual loss of 16% over the period. That suggests the market is disappointed with the current growth rate. A pessimistic market can create opportunities.
You can see how earnings and revenue have changed over time in the image below (click on the chart to see the exact values).
This free interactive report on Central Development Holdings's balance sheet strength is a great place to start, if you want to investigate the stock further.
A Different Perspective
It's nice to see that Central Development Holdings shareholders have received a total shareholder return of 42% 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. We generally put more weight on the long term performance over the short term, but the recent improvement could hint at a (positive) inflection point within the business. You could get a better understanding of Central Development Holdings's growth by checking out this more detailed historical graph of earnings, revenue and cash flow.
But note: Central Development Holdings 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 HK exchanges.
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.
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. Thank you for reading.