Yahoo Finance The 12% return this week takes Santacruz Silver Mining's (CVE:SCZ) shareholders five-year gains to 327%
It hasn't been the best quarter for Santacruz Silver Mining Ltd. (CVE:SCZ) shareholders, since the share price has fallen 22% in that time. But that doesn't change the fact that the returns over the last half decade have been spectacular. Indeed, the share price is up a whopping 327% in that time. So we don't think the recent decline in the share price means its story is a sad one. Of course what matters most is whether the business can improve itself sustainably, thus justifying a higher price. Unfortunately not all shareholders will have held it for the long term, so spare a thought for those caught in the 41% decline over the last twelve months.
After a strong gain in the past week, it's worth seeing if longer term returns have been driven by improving fundamentals.
View our latest analysis for Santacruz Silver Mining
Santacruz Silver Mining isn't currently profitable, so most analysts would look to revenue growth to get an idea of how fast the underlying business is growing. Shareholders of unprofitable companies usually expect strong revenue growth. 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.
For the last half decade, Santacruz Silver Mining can boast revenue growth at a rate of 60% per year. That's well above most pre-profit companies. Arguably, this is well and truly reflected in the strong share price gain of 34%(per year) over the same period. It's never too late to start following a top notch stock like Santacruz Silver Mining, since some long term winners go on winning for decades. So we'd recommend you take a closer look at this one, but keep in mind the market seems optimistic.
You can see below how earnings and revenue have changed over time (discover the exact values by clicking on the image).
We consider it positive that insiders have made significant purchases in the last year. Even so, future earnings will be far more important to whether current shareholders make money. Before buying or selling a stock, we always recommend a close examination of historic growth trends, available here..
A Different Perspective
Investors in Santacruz Silver Mining had a tough year, with a total loss of 41%, against a market gain of about 13%. Even the share prices of good stocks drop sometimes, but we want to see improvements in the fundamental metrics of a business, before getting too interested. Longer term investors wouldn't be so upset, since they would have made 34%, each year, over five years. It could be that the recent sell-off is an opportunity, so it may be worth checking the fundamental data for signs of a long term growth trend. It's always interesting to track share price performance over the longer term. But to understand Santacruz Silver Mining better, we need to consider many other factors. For instance, we've identified 4 warning signs for Santacruz Silver Mining (2 are a bit unpleasant) that you should be aware of.
Santacruz Silver Mining is not the only stock that insiders are buying. For those who like to find winning investments this free list of growing companies with recent insider purchasing, could be just the ticket.
Please note, the market returns quoted in this article reflect the market weighted average returns of stocks that currently trade on Canadian 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.
