Generally speaking, investors are inspired to be stock pickers by the potential to find the big winners. Not every pick can be a winner, but when you pick the right stock, you can win big. One bright shining star stock has been Alibaba Health Information Technology Limited (HKG:241), which is 420% higher than three years ago. In the last week shares have slid back 7.2%.
View our latest analysis for Alibaba Health Information Technology
Given that Alibaba Health Information Technology didn’t make a profit in the last twelve months, we’ll focus on revenue growth to form a quick view of its business development. When a company doesn’t make profits, we’d generally expect to see good revenue growth. That’s because it’s hard to be confident a company will be sustainable if revenue growth is negligible, and it never makes a profit.
Alibaba Health Information Technology’s revenue trended up 72% each year over three years. That’s well above most pre-profit companies. In light of this attractive revenue growth, it seems somewhat appropriate that the share price has been rocketing, boasting a gain of 73% per year, over the same period. It’s always tempting to take profits after a share price gain like that, but high-growth companies like Alibaba Health Information Technology can sometimes sustain strong growth for many years. In fact, it might be time to put it on your watchlist, if you’re not already familiar with the stock.
The company’s revenue and earnings (over time) are depicted in the image below (click to see the exact numbers).
This free interactive report on Alibaba Health Information Technology’s balance sheet strength is a great place to start, if you want to investigate the stock further.
A Different Perspective
It’s nice to see that Alibaba Health Information Technology shareholders have received a total shareholder return of 148% over the last year. Since the one-year TSR is better than the five-year TSR (the latter coming in at 28% per year), it would seem that the stock’s performance has improved in recent times. Given the share price momentum remains strong, it might be worth taking a closer look at the stock, lest you miss an opportunity. 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. For example, we’ve discovered 3 warning signs for Alibaba Health Information Technology that you should be aware of before investing here.
If you would prefer to check out another company — one with potentially superior financials — then do not miss this free list of companies that have proven they can grow earnings.
Please note, the market returns quoted in this article reflect the market weighted average returns of stocks that currently trade on HK 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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