LatAm Autos Limited (ASX:LAA) shareholders should be happy to see the share price up 17% in the last month. But that cannot eclipse the less-than-impressive returns over the last three years. After all, the share price is down 46% in the last three years, significantly under-performing the market.
Check out our latest analysis for LatAm Autos
Given that LatAm Autos 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 three years LatAm Autos saw its revenue shrink by 4.3% per year. That is not a good result. The annual decline of 19% per year in that period has clearly disappointed holders. And with no profits, and weak revenue, are you surprised? However, in this kind of situation you can sometimes find opportunity, where sentiment is negative but the company is actually making good progress.
The graphic below shows how revenue and earnings have changed as management guided the business forward. If you want to see cashflow, you can click on the chart.
We like that insiders have been buying shares in the last twelve months. Even so, future earnings will be far more important to whether current shareholders make money. If you are thinking of buying or selling LatAm Autos stock, you should check out this free report showing analyst profit forecasts.
A Different Perspective
We’re pleased to report that LatAm Autos rewarded shareholders with a total shareholder return of 27% over the last year. What is absolutely clear is that is far preferable to the dismal 19% average annual loss suffered over the last three years. We’re generally cautious about putting too much weigh on shorter term data, but the recent improvement is definitely a positive. Investors who like to make money usually check up on insider purchases, such as the price paid, and total amount bought. You can find out about the insider purchases of LatAm Autos by clicking this link.
There are plenty of other companies that have insiders buying up shares. You probably do not want to miss this free list of growing companies that insiders are buying.
Please note, the market returns quoted in this article reflect the market weighted average returns of stocks that currently trade on AU 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.