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Tropicana Corporation Berhad (KLSE:TROP) shareholders have earned a 9.6% CAGR over the last five years


Tropicana Corporation Berhad (KLSE:TROP) shareholders have earned a 9.6% CAGR over the last five years

Tropicana Corporation Berhad (KLSE:TROP) shareholders might be concerned after seeing the share price drop 22% in the last quarter. On the bright side the returns have been quite good over the last half decade. After all, the share price is up a market-beating 58% in that time.

So let's investigate and see if the longer term performance of the company has been in line with the underlying business' progress.

See our latest analysis for Tropicana Corporation Berhad

Tropicana Corporation Berhad wasn't profitable in the last twelve months, it is unlikely we'll see a strong correlation between its share price and its earnings per share (EPS). Arguably revenue is our next best option. When a company doesn't make profits, we'd generally hope to see good revenue growth. That's because fast revenue growth can be easily extrapolated to forecast profits, often of considerable size.

In the last 5 years Tropicana Corporation Berhad saw its revenue grow at 2.5% per year. That's not a very high growth rate considering the bottom line. The modest growth is probably broadly reflected in the share price, which is up 10%, per year over 5 years. The business could be one worth watching but we generally prefer faster revenue growth.

The image below shows how earnings and revenue have tracked over time (if you click on the image you can see greater detail).

If you are thinking of buying or selling Tropicana Corporation Berhad stock, you should check out this FREE detailed report on its balance sheet.

Tropicana Corporation Berhad provided a TSR of 8.3% over the last twelve months. But that return falls short of the market. If we look back over five years, the returns are even better, coming in at 10% per year for five years. Maybe the share price is just taking a breather while the business executes on its growth strategy. While it is well worth considering the different impacts that market conditions can have on the share price, there are other factors that are even more important. For instance, we've identified 1 warning sign for Tropicana Corporation Berhad that you should be aware of.

For those who like to find winning investments this free list of undervalued 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 Malaysian exchanges.

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