Karex Berhad (KLSE:KAREX) shareholders might be concerned after seeing the share price drop 24% in the last quarter. While that might be a setback, it doesn't negate the nice returns received over the last twelve months. After all, the share price is up a market-beating 62% in that time.
With that in mind, it's worth seeing if the company's underlying fundamentals have been the driver of long term performance, or if there are some discrepancies.
View our latest analysis for Karex Berhad
While Karex Berhad made a small profit, in the last year, we think that the market is probably more focussed on the top line growth at the moment. Generally speaking, we'd consider a stock like this alongside loss-making companies, simply because the quantum of the profit is so low. For shareholders to have confidence a company will grow profits significantly, it must grow revenue.
Over the last twelve months, Karex Berhad's revenue grew by 23%. That's a fairly respectable growth rate. While the share price performed well, gaining 62% over twelve months, you could argue the revenue growth warranted it. If the company can maintain the revenue growth, the share price could go higher still. But it's crucial to check profitability and cash flow before forming a view on the future.
You can see how earnings and revenue have changed over time in the image below (click on the chart to see the exact values).
We know that Karex Berhad has improved its bottom line lately, but what does the future have in store? If you are thinking of buying or selling Karex Berhad stock, you should check out this free report showing analyst profit forecasts.
A Different Perspective
We're pleased to report that Karex Berhad shareholders have received a total shareholder return of 62% over one year. That certainly beats the loss of about 3% per year over the last half decade. This makes us a little wary, but the business might have turned around its fortunes. You might want to assess this data-rich visualization of its earnings, revenue and cash flow.
But note: Karex Berhad 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 Malaysian 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.
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