Investors in Compañía de Minas BuenaventuraA (NYSE:BVN) have seen impressive returns of 107% over the past year
Unless you borrow money to invest, the potential losses are limited. But if you pick the right business to buy shares in, you can make more than you can lose. For example, the Compañía de Minas Buenaventura S.A.A. (NYSE:BVN) share price had more than doubled in just one year - up 105%. On top of that, the share price is up 71% in about a quarter. Also impressive, the stock is up 46% over three years, making long term shareholders happy, too.
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.
Check out our latest analysis for Compañía de Minas BuenaventuraA
There is no denying that markets are sometimes efficient, but prices do not always reflect underlying business performance. One flawed but reasonable way to assess how sentiment around a company has changed is to compare the earnings per share (EPS) with the share price.
During the last year, Compañía de Minas BuenaventuraA actually saw its earnings per share drop 42%.
Given the share price gain, we doubt the market is measuring progress with EPS. Therefore, it seems likely that investors are putting more weight on metrics other than EPS, at the moment.
We doubt the modest 0.5% dividend yield is doing much to support the share price. Revenue was pretty stable on last year, so deeper research might be needed to explain the share price rise.
The company's revenue and earnings (over time) are depicted in the image below (click to see the exact numbers).
It is of course excellent to see how Compañía de Minas BuenaventuraA has grown profits over the years, but the future is more important for shareholders. If you are thinking of buying or selling Compañía de Minas BuenaventuraA stock, you should check out this FREE detailed report on its balance sheet.
A Different Perspective
It's good to see that Compañía de Minas BuenaventuraA has rewarded shareholders with a total shareholder return of 107% in the last twelve months. That's including the dividend. Notably the five-year annualised TSR loss of 1.8% per year compares very unfavourably with the recent share price performance. We generally put more weight on the long term performance over the short term, but the recent improvement could hint at a (positive) inflection point within the business. It's always interesting to track share price performance over the longer term. But to understand Compañía de Minas BuenaventuraA better, we need to consider many other factors. Take risks, for example - Compañía de Minas BuenaventuraA has 1 warning sign 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 American 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.
