Buying shares in the best businesses can build meaningful wealth for you and your family. While the best companies are hard to find, but they can generate massive returns over long periods. Don’t believe it? Then look at the Ballard Power Systems Inc. (TSE:BLDP) share price. It’s 726% higher than it was five years ago. And this is just one example of the epic gains achieved by some long term investors. In the last week shares have slid back 3.5%.
It really delights us to see such great share price performance for investors.
See our latest analysis for Ballard Power Systems
Because Ballard Power Systems made a loss in the last twelve months, we think the market is probably more focussed on revenue and revenue growth, at least for now. When a company doesn’t make profits, we’d generally expect to see good revenue growth. Some companies are willing to postpone profitability to grow revenue faster, but in that case one does expect good top-line growth.
In the last 5 years Ballard Power Systems saw its revenue grow at 5.8% per year. Put simply, that growth rate fails to impress. So shareholders should be pretty elated with the 53% increase per year, in that time. We’ll tip our hats to that, any day, but the top-line growth isn’t particularly impressive when you compare it to other pre-profit companies. Having said that, a closer look at the numbers might surface good reasons to believe that profits will gush in the future.
You can see below how earnings and revenue have changed over time (discover the exact values by clicking on the image).
TSX:BLDP Earnings and Revenue Growth August 8th 2021
Ballard Power Systems is a well known stock, with plenty of analyst coverage, suggesting some visibility into future growth. You can see what analysts are predicting for Ballard Power Systems in this interactive graph of future profit estimates.
A Different Perspective
Ballard Power Systems shareholders are down 1.3% for the year, but the market itself is up 31%. However, keep in mind that even the best stocks will sometimes underperform the market over a twelve month period. Longer term investors wouldn’t be so upset, since they would have made 53%, 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. On the same subject : This fintech startup is helping MSMEs stay on top of their finances, get real-time insights – YourStory. It’s always interesting to track share price performance over the longer term. But to understand Ballard Power Systems better, we need to consider many other factors. To that end, you should be aware of the 3 warning signs we’ve spotted with Ballard Power Systems .
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 CA exchanges.
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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.
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