Yahoo Finance AIC Mines (ASX:A1M) shareholder returns have been notable, earning 64% in 3 years
By buying an index fund, you can roughly match the market return with ease. But if you buy good businesses at attractive prices, your portfolio returns could exceed the average market return. For example, AIC Mines Limited (ASX:A1M) shareholders have seen the share price rise 64% over three years, well in excess of the market return (5.1%, not including dividends). However, more recent returns haven't been as impressive as that, with the stock returning just 12% in the last year.
Since it's been a strong week for AIC Mines shareholders, let's have a look at trend of the longer term fundamentals.
View our latest analysis for AIC Mines
We don't think that AIC Mines' modest trailing twelve month profit has the market's full attention at the moment. We think revenue is probably a better guide. 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.
Over the last three years AIC Mines has grown its revenue at 85% annually. That's well above most pre-profit companies. While the compound gain of 18% per year over three years is pretty good, you might argue it doesn't fully reflect the strong revenue growth. So now might be the perfect time to put AIC Mines on your radar. If the company is trending towards profitability then it could be very interesting.
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 consider it positive that insiders have made significant purchases in the last year. Having said that, most people consider earnings and revenue growth trends to be a more meaningful guide to the business. If you are thinking of buying or selling AIC Mines stock, you should check out this free report showing analyst profit forecasts.
A Different Perspective
We're pleased to report that AIC Mines shareholders have received a total shareholder return of 12% over one year. Since the one-year TSR is better than the five-year TSR (the latter coming in at 7% per year), it would seem that the stock's performance has improved in recent times. In the best case scenario, this may hint at some real business momentum, implying that now could be a great time to delve deeper. 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. Like risks, for instance. Every company has them, and we've spotted 3 warning signs for AIC Mines (of which 1 is significant!) you should know about.
AIC Mines 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 Australian 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.
