Yahoo Finance CAMERIT (FRA:RTML) shareholders have earned a 14% CAGR over the last three years
No-one enjoys it when they lose money on a stock. But no-one can make money on every call, especially in a declining market. The CAMERIT AG (FRA:RTML) is down 55% over three years, but the total shareholder return is 47% once you include the dividend. That's better than the market which declined 9.4% over the last three years. Unfortunately the last month hasn't been any better, with the share price down 64%.
Now let's have a look at the company's fundamentals, and see if the long term shareholder return has matched the performance of the underlying business.
See our latest analysis for CAMERIT
We don't think CAMERIT's revenue of €66,548 is enough to establish significant demand. This state of affairs suggests that venture capitalists won't provide funds on attractive terms. So it seems shareholders are too busy dreaming about the progress to come than dwelling on the current (lack of) revenue. Investors will be hoping that CAMERIT can make progress and gain better traction for the business, before it runs low on cash.
As a general rule, if a company doesn't have much revenue, and it loses money, then it is a high risk investment. There is usually a significant chance that they will need more money for business development, putting them at the mercy of capital markets to raise equity. So the share price itself impacts the value of the shares (as it determines the cost of capital). While some such companies do very well over the long term, others become hyped up by promoters before eventually falling back down to earth, and going bankrupt (or being recapitalized). It certainly is a dangerous place to invest, as CAMERIT investors might realise.
CAMERIT has plenty of cash in the bank, with cash in excess of all liabilities sitting at €6.8m, when it last reported (December 2023). This gives management the flexibility to drive business growth, without worrying too much about cash reserves. But with the share price diving 16% per year, over 3 years , it could be that the price was previously too hyped up. You can see in the image below, how CAMERIT's cash levels have changed over time (click to see the values).
It can be extremely risky to invest in a company that doesn't even have revenue. There's no way to know its value easily. Would it bother you if insiders were selling the stock? It would bother me, that's for sure. It costs nothing but a moment of your time to see if we are picking up on any insider selling.
What About The Total Shareholder Return (TSR)?
Investors should note that there's a difference between CAMERIT's total shareholder return (TSR) and its share price change, which we've covered above. 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. We note that CAMERIT's TSR, at 47% is higher than its share price return of -55%. When you consider it hasn't been paying a dividend, this data suggests shareholders have benefitted from a spin-off, or had the opportunity to acquire attractively priced shares in a discounted capital raising.
A Different Perspective
It's good to see that CAMERIT has rewarded shareholders with a total shareholder return of 66% in the last twelve months. That's better than the annualised return of 35% over half a decade, implying that the company is doing better recently. 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. Consider for instance, the ever-present spectre of investment risk. We've identified 4 warning signs with CAMERIT , and understanding them should be part of your investment process.
But note: CAMERIT 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 German exchanges.
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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.
Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com
