Yahoo Finance Investors in Brockhaus Technologies (FRA:BKHT) have made a return of 10% over the past year
Passive investing in index funds can generate returns that roughly match the overall market. But investors can boost returns by picking market-beating companies to own shares in. To wit, the Brockhaus Technologies AG (FRA:BKHT) share price is 10% higher than it was a year ago, much better than the market decline of around 16% (not including dividends) in the same period. That's a solid performance by our standards! Note that businesses generally develop over the long term, so the returns over the last year might not reflect a long term trend.
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.
See our latest analysis for Brockhaus Technologies
While Brockhaus Technologies 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.
Brockhaus Technologies grew its revenue by 185% last year. That's a head and shoulders above most loss-making companies. The solid 10% share price gain goes down pretty well, but it's not necessarily as good as you might expect given the top notch revenue growth. So quite frankly it could be a good time to investigate Brockhaus Technologies in some detail. Since we evolved from monkeys, we think in linear terms by nature. So if growth goes exponential, opportunity may exist for the enlightened.
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 Brockhaus Technologies has improved its bottom line lately, but what does the future have in store? You can see what analysts are predicting for Brockhaus Technologies in this interactive graph of future profit estimates.
A Different Perspective
Brockhaus Technologies boasts a total shareholder return of 10% for the last year. A substantial portion of that gain has come in the last three months, with the stock up 42% in that time. Demand for the stock from multiple parties is pushing the price higher; it could be that word is getting out about its virtues as a business. 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. Consider for instance, the ever-present spectre of investment risk. We've identified 2 warning signs with Brockhaus Technologies (at least 1 which is significant) , and understanding them should be part of your investment process.
But note: Brockhaus Technologies 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 DE 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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