While it may not be enough for some shareholders, we think it is good to see the Pos Malaysia Berhad (KLSE:POS) share price up 25% in a single quarter. But that doesn’t change the fact that the returns over the last half decade have been disappointing. In fact, the share price has declined rather badly, down some 69% in that time. So is the recent increase sufficient to restore confidence in the stock? Not yet. We’d err towards caution given the long term under-performance.
Since shareholders are down over the longer term, lets look at the underlying fundamentals over the that time and see if they’ve been consistent with returns.
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Pos Malaysia Berhad isn’t currently profitable, so most analysts would look to revenue growth to get an idea of how fast the underlying business is growing. Generally speaking, companies without profits are expected to grow revenue every year, and at a good clip. That’s because fast revenue growth can be easily extrapolated to forecast profits, often of considerable size.
You can see below how earnings and revenue have changed over time (discover the exact values by clicking on the image).
This free interactive report on Pos Malaysia Berhad’s balance sheet strength is a great place to start, if you want to investigate the stock further.
It’s good to see that Pos Malaysia Berhad has rewarded shareholders with a total shareholder return of 20% in the last twelve months. That certainly beats the loss of about 11% per year over the last half decade. This makes us a little wary, but the business might have turned around its fortunes. It’s always interesting to track share price performance over the longer term. But to understand Pos Malaysia Berhad better, we need to consider many other factors. Take risks, for example – Pos Malaysia Berhad has 3 warning signs we think you should be aware of.
Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of companies we expect will grow earnings.
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.