While shareholders of Mineral Commodities (ASX:MRC) are in the red over the last year, underlying earnings have actually grown

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Mineral Commodities Ltd (ASX:MRC) shareholders should be happy to see the share price up 29% in the last month. But that doesn’t change the fact that the returns over the last year have been disappointing. Specifically, the stock price slipped by 65% in that time. It’s not that amazing to see a bounce after a drop like that. You could argue that the sell-off was too severe.

The recent uptick of 17% could be a positive sign of things to come, so let’s take a lot at historical fundamentals.

View our latest analysis for Mineral Commodities

To paraphrase Benjamin Graham: Over the short term the market is a voting machine, but over the long term it’s a weighing machine. One flawed but reasonable way to assess how sentiment around a company has changed is to compare the earnings per share (EPS) with the share price.

Even though the Mineral Commodities share price is down over the year, its EPS actually improved. It could be that the share price was previously over-hyped.

It’s fair to say that the share price does not seem to be reflecting the EPS growth. So it’s easy to justify a look at some other metrics.

Mineral Commodities’ revenue is actually up 44% over the last year. Since we can’t easily explain the share price movement based on these metrics, it might be worth considering how market sentiment has changed towards the stock.

The image below shows how earnings and revenue have tracked over time (if you click on the image you can see greater detail).

ASX:MRC Earnings and Revenue Growth January 14th 2022

If you are thinking of buying or selling Mineral Commodities stock, you should check out this FREE detailed report on its balance sheet.

A Different Perspective

Investors in Mineral Commodities had a tough year, with a total loss of 65%, against a market gain of about 16%. However, keep in mind that even the best stocks will sometimes underperform the market over a twelve month period. On the bright side, long term shareholders have made money, with a gain of 7% per year over half a decade. If the fundamental data continues to indicate long term sustainable growth, the current sell-off could be an opportunity worth considering. It’s always interesting to track share price performance over the longer term. But to understand Mineral Commodities better, we need to consider many other factors. Case in point: We’ve spotted 4 warning signs for Mineral Commodities you should be aware of.

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 AU exchanges.

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.