Chalice Mining's (ASX:CHN) investors will be pleased with their incredible 601% return over the last five years
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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. To wit, the Chalice Mining Limited (ASX:CHN) share price has soared 591% over five years. This just goes to show the value creation that some businesses can achieve. It's also up 33% in about a month. We note that Chalice Mining reported its financial results recently; luckily, you can catch up on the latest revenue and profit numbers in our company report. Anyone who held for that rewarding ride would probably be keen to talk about it.
Now it's worth having a look at the company's fundamentals too, because that will help us determine if the long term shareholder return has matched the performance of the underlying business.
Check out our latest analysis for Chalice Mining
Chalice Mining 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 Chalice Mining saw its revenue grow at 52% per year. That's well above most pre-profit companies. Fortunately, the market has not missed this, and has pushed the share price up by 47% per year in that time. It's never too late to start following a top notch stock like Chalice Mining, since some long term winners go on winning for decades. On the face of it, this looks lke a good opportunity, although we note sentiment seems very positive already.
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 Chalice Mining stock, you should check out this FREE detailed report on its balance sheet.
What About The Total Shareholder Return (TSR)?
We'd be remiss not to mention the difference between Chalice Mining's total shareholder return (TSR) and its share price return. The TSR attempts to capture the value of dividends (as if they were reinvested) as well as any spin-offs or discounted capital raisings offered to shareholders. Chalice Mining hasn't been paying dividends, but its TSR of 601% exceeds its share price return of 591%, implying it has either spun-off a business, or raised capital at a discount; thereby providing additional value to shareholders.