While Perdana Petroleum Berhad (KLSE:PERDANA) shareholders are probably generally happy, the stock hasn’t had particularly good run recently, with the share price falling 15% in the last quarter. But in three years the returns have been great. Indeed, the share price is up a very strong 104% in that time. So the recent fall in the share price should be viewed in that context. The fundamental business performance will ultimately dictate whether the top is in, or if this is a stellar buying opportunity.
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 Perdana Petroleum Berhad
There is no denying that markets are sometimes efficient, but prices do not always reflect underlying business performance. By comparing earnings per share (EPS) and share price changes over time, we can get a feel for how investor attitudes to a company have morphed over time.
During three years of share price growth, Perdana Petroleum Berhad moved from a loss to profitability. That kind of transition can be an inflection point that justifies a strong share price gain, just as we have seen here.
The graphic below depicts how EPS has changed over time (unveil the exact values by clicking on the image).
KLSE:PERDANA Earnings Per Share Growth February 24th 2025
This free interactive report on Perdana Petroleum Berhad’s earnings, revenue and cash flow is a great place to start, if you want to investigate the stock further.
Investors in Perdana Petroleum Berhad had a tough year, with a total loss of 9.6%, against a market gain of about 5.1%. Even the share prices of good stocks drop sometimes, but we want to see improvements in the fundamental metrics of a business, before getting too interested. Unfortunately, last year’s performance may indicate unresolved challenges, given that it was worse than the annualised loss of 6% over the last half decade. We realise that Baron Rothschild has said investors should “buy when there is blood on the streets”, but we caution that investors should first be sure they are buying a high quality business. I find it very interesting to look at share price over the long term as a proxy for business performance. But to truly gain insight, we need to consider other information, too. For instance, we’ve identified 2 warning signs for Perdana Petroleum Berhad that you should be aware of.
If you are like me, then you will not want to miss this free list of undervalued small caps that insiders are buying.
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