The simplest way to invest in stocks is to buy exchange-traded funds. But one can do better than that by picking better than average stocks (as part of a diversified portfolio).
For example, the Integumen Plc (LON:SKIN) share price is up 82% in the last year, clearly besting the market decline of around 10% (not including dividends). So that should have shareholders smiling. However, the longer term returns haven’t been so impressive, with the stock up just 22% in the last three years.
Given that Integumen 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. As you can imagine, fast revenue growth, when maintained, often leads to fast profit growth.
Integumen grew its revenue by 200% last year. That’s stonking growth even when compared to other loss-making stocks. The solid 82% share price gain goes down pretty well, but it’s not necessarily as good as you might expect given the top notch revenue growth. So quite frankly it could be a good time to investigate Integumen in some detail. Since we evolved from monkeys, we think in linear terms by nature. So if growth goes exponential, opportunity may exist for the enlightened.
You can see how earnings and revenue have changed over time in the image below (click on the chart to see the exact values).
We’re pleased to report that the CEO is remunerated more modestly than most CEOs at similarly capitalized companies. It’s always worth keeping an eye on CEO pay, but a more important question is whether the company will grow earnings throughout the years. It might be well worthwhile taking a look at our free report on Integumen’s earnings, revenue and cash flow.
A Different Perspective
We’re pleased to report that Integumen rewarded shareholders with a total shareholder return of 82% over the last year. That’s better than the annualized TSR of 7.0% over the last three years. These improved returns may hint at some real business momentum, implying that now could be a great time to delve deeper. It’s always interesting to track share price performance over the longer term. But to understand Integumen better, we need to consider many other factors. For example, we’ve discovered 5 warning signs for Integumen (1 shouldn’t be ignored!) that you should be aware of before investing here.
Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of companies we expect will grow earnings.
Please note, the market returns quoted in this article reflect the market weighted average returns of stocks that currently trade on GB exchanges.
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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