TSE:ABX) stock is up an impressive 288% over the last five years. In the last week the share price is up 3.2%.” data-reactid=”28″>The worst result, after buying shares in a company (assuming no leverage), would be if you lose all the money you put in. But when you pick a company that is really flourishing, you can make more than 100%. For instance, the price of Barrick Gold Corporation (TSE:ABX) stock is up an impressive 288% over the last five years. In the last week the share price is up 3.2%.
See our latest analysis for Barrick Gold ” data-reactid=”29″>See our latest analysis for Barrick Gold
To quote Buffett, ‘Ships will sail around the world but the Flat Earth Society will flourish. There will continue to be wide discrepancies between price and value in the marketplace…’ One imperfect but simple way to consider how the market perception of a company has shifted is to compare the change in the earnings per share (EPS) with the share price movement.
During the five years of share price growth, Barrick Gold moved from a loss to profitability. Sometimes, the start of profitability is a major inflection point that can signal fast earnings growth to come, which in turn justifies very strong share price gains. Given that the company made a profit three years ago, but not five years ago, it is worth looking at the share price returns over the last three years, too. We can see that the Barrick Gold share price is up 81% in the last three years. During the same period, EPS grew by 26% each year. That makes the EPS growth rather close to the annualized share price gain of 22% over the same period. So one might argue that investor sentiment towards the stock hss not changed much over time. There’s a strong correlation between the share price and EPS.
You can see below how EPS has changed over time (discover the exact values by clicking on the image).
historic growth trends, available here..” data-reactid=”49″>We like that insiders have been buying shares in the last twelve months. Having said that, most people consider earnings and revenue growth trends to be a more meaningful guide to the business. Before buying or selling a stock, we always recommend a close examination of historic growth trends, available here..
What About Dividends?
A Different Perspective
3 warning signs for Barrick Gold you should be aware of, and 1 of them is a bit unpleasant.” data-reactid=”53″>We’re pleased to report that Barrick Gold shareholders have received a total shareholder return of 65% over one year. Of course, that includes the dividend. That’s better than the annualised return of 32% over half a decade, implying that the company is doing better recently. In the best case scenario, this may hint at some real business momentum, implying that now could be a great time to delve deeper. It’s always interesting to track share price performance over the longer term. But to understand Barrick Gold better, we need to consider many other factors. Case in point: We’ve spotted 3 warning signs for Barrick Gold you should be aware of, and 1 of them is a bit unpleasant.
list of companies. (Hint: insiders have been buying them).” data-reactid=”58″>If you like to buy stocks alongside management, then you might just love this free list of companies. (Hint: insiders have been buying them).
Get in touch with us directly. Alternatively, email [email protected].” data-reactid=”60″>This article by Simply Wall St is general in nature. 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.