Those who invested in Deleum Berhad (KLSE:DELEUM) three years ago are up 151%

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15-05-2025

The most you can lose on any stock (assuming you don't use leverage) is 100% of your money. But if you buy shares in a really great company, you can more than double your money. For example, the Deleum Berhad (KLSE:DELEUM) share price has soared 110% in the last three years. Most would be happy with that. Also pleasing for shareholders was the 11% gain in the last three months. The company reported its financial results recently; you can catch up on the latest numbers by reading our company report.
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.
We've discovered 2 warning signs about Deleum Berhad. View them for free.
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 three years of share price growth, Deleum Berhad achieved compound earnings per share growth of 57% per year. The average annual share price increase of 28% is actually lower than the EPS growth. So one could reasonably conclude that the market has cooled on the stock. This cautious sentiment is reflected in its (fairly low) P/E ratio of 8.07.
The company's earnings per share (over time) is depicted in the image below (click to see the exact numbers).
We know that Deleum Berhad has improved its bottom line over the last three years, but what does the future have in store? Take a more thorough look at Deleum Berhad's financial health with this free report on its balance sheet.
When looking at investment returns, it is important to consider the difference between total shareholder return (TSR) and share price return. The TSR is a return calculation that accounts for the value of cash dividends (assuming that any dividend received was reinvested) and the calculated value of any discounted capital raisings and spin-offs. Arguably, the TSR gives a more comprehensive picture of the return generated by a stock. As it happens, Deleum Berhad's TSR for the last 3 years was 151%, which exceeds the share price return mentioned earlier. This is largely a result of its dividend payments!
We're pleased to report that Deleum Berhad shareholders have received a total shareholder return of 5.7% over one year. Of course, that includes the dividend. However, that falls short of the 20% TSR per annum it has made for shareholders, each year, over five years. Potential buyers might understandably feel they've missed the opportunity, but it's always possible business is still firing on all cylinders. It's always interesting to track share price performance over the longer term. But to understand Deleum Berhad better, we need to consider many other factors. For example, we've discovered 2 warning signs for Deleum Berhad (1 shouldn't be ignored!) that you should be aware of before investing here.
But note: Deleum Berhad may not be the best stock to buy. So take a peek at this free list of interesting companies with past earnings growth (and further growth forecast).
Please note, the market returns quoted in this article reflect the market weighted average returns of stocks that currently trade on Malaysian exchanges.
Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.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.