GetSwift Limited (ASX:GSW) shareholders might be concerned after seeing the share price drop 13% in the last month. But that doesn't change the fact that the returns over the last three years have been pleasing. In the last three years the share price is up, 63%: better than the market.
View our latest analysis for GetSwift
Because GetSwift is loss-making, we think the market is probably more focussed on revenue and revenue growth, at least for now. Shareholders of unprofitable companies usually expect strong revenue growth. That's because it's hard to be confident a company will be sustainable if revenue growth is negligible, and it never makes a profit.
Over the last three years GetSwift has grown its revenue at 80% annually. That's much better than most loss-making companies. The share price rise of 18% per year throughout that time is nice to see, and given the revenue growth, that gain seems somewhat justified. If that's the case, now might be the time to take a close look at GetSwift. If the company is trending towards profitability then it could be very interesting.
The image below shows how earnings and revenue have tracked over time (if you click on the image you can see greater detail).
It's good to see that there was some significant insider buying in the last three months. That's a positive. On the other hand, we think the revenue and earnings trends are much more meaningful measures of the business. This free interactive report on GetSwift's earnings, revenue and cash flow is a great place to start, if you want to investigate the stock further.
A Different Perspective
GetSwift produced a TSR of 5.4% over the last year. While you don't go broke making a profit, this return was actually lower than the average market return of about 22%. But the (superior) three-year TSR of 18% per year is some consolation. Even the best companies don't see strong share price performance every year. It is all well and good that insiders have been buying shares, but we suggest you check here to see what price insiders were buying at.
GetSwift is not the only stock that insiders are buying. For those who like to find winning investments this free list of growing companies with recent insider purchasing, could be just the ticket.
Please note, the market returns quoted in this article reflect the market weighted average returns of stocks that currently trade on AU exchanges.
If you spot an error that warrants correction, please contact the editor at email@example.com. 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. Simply Wall St has no position in the stocks mentioned.
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