3 Stocks with Returns of Over 500% in 10 Years

There are many stocks in Singapore’s market that have delivered great returns over the past decade. Here are three companies that have achieved returns of over 500% in the past 10 years: Straco Corporation Ltd (SGX: S85), Sim Lian Group Ltd (SGX: S05), and Raffles Medical Group Ltd (SGX: BSL).

Straco, Sim Lian, RMG share price return
Source: S&P Global Market Intelligence

I have a few interesting takeaways after taking a closer look at their business performances.

First, you can see their annualised profit growth in their last 10 fiscal years in the table below:

Straco, Sim Lian, RMG annualised profit growth
Source: S&P Global Market Intelligence

All three companies have seen their earnings grow by at least 16% per year. These solid growth rates are a great example of the simple but important idea that a stock’s price is very much influenced by the performance of its business over long time frames.

Second, the trio have generated high average returns on equity in the mid-teens percentages or more over their last 10 fiscal years:

Straco, Sim Lian, RMG average anual ROE
Source: S&P Global Market Intelligence

It’s by no means a perfect statistical study, but what I have does highlight the idea that a company’s long-term average return on equity can be an important driver of its share price return. For investors who are out looking for winning long-term investments, the return on equity could thus be one of the many important things about a company to observe.

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The information provided is for general information purposes only and is not intended to be personalised investment or financial advice. Motley Fool Singapore contributor Lawrence Nga doesn’t own shares in any companies mentioned.