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When you buy a stock there is always a possibility that it could drop 100%. But when you pick a company that is really flourishing, you can make more than 100%. One great example is Almonty Industries Inc. (TSE:AII) which saw its share price drive 132% higher over five years.
See our latest analysis for Almonty Industries
Almonty Industries wasn't profitable in the last twelve months, it is unlikely we'll see a strong correlation between its share price and its earnings per share (EPS). Arguably revenue is our next best option. Generally speaking, companies without profits are expected to grow revenue every year, and at a good clip. That's because it's hard to be confident a company will be sustainable if revenue growth is negligible, and it never makes a profit.
In the last 5 years Almonty Industries saw its revenue grow at 3.0% per year. That's not a very high growth rate considering the bottom line. So we wouldn't have expected to see the share price to have lifted 18% for each year during that time, but that's what happened. Shareholders should be pretty happy with that, although interested investors might want to examine the financial data more closely to see if the gains are really justified. It may be that the market is pretty optimistic about Almonty Industries.
The image below shows how earnings and revenue have tracked over time (if you click on the image you can see greater detail).
We like that insiders have been buying shares in the last twelve months. Having said that, most people consider earnings and revenue growth trends to be a more meaningful guide to the business. You can see what analysts are predicting for Almonty Industries in this interactive graph of future profit estimates.
A Different Perspective
It's nice to see that Almonty Industries shareholders have received a total shareholder return of 55% over the last year. Since the one-year TSR is better than the five-year TSR (the latter coming in at 18% per year), it would seem that the stock's performance has improved in recent times. In the best case scenario, this may hint at some real business momentum, implying that now could be a great time to delve deeper. 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. To that end, you should learn about the 2 warning signs we've spotted with Almonty Industries (including 1 which is potentially serious) .
Almonty Industries is not the only stock insiders are buying. So take a peek at this free list of growing companies with insider buying.