Investing in Voltatron (FRA:VBX) a year ago would have delivered you a 348% gain

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2 days ago

While stock picking isn't easy, for those willing to persist and learn, it is possible to buy shares in great companies, and generate wonderful returns. When you buy and hold the right company, the returns can make a huge difference to both you and your family. For example, the Voltatron AG (FRA:VBX) share price rocketed moonwards 348% in just one year. It's also up 21% in about a month. Also impressive, the stock is up 127% over three years, making long term shareholders happy, too.
Let's take a look at the underlying fundamentals over the longer term, and see if they've been consistent with shareholders returns.
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Given that Voltatron 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 hope to see good revenue growth. That's because fast revenue growth can be easily extrapolated to forecast profits, often of considerable size.
In the last year Voltatron saw its revenue shrink by 3.1%. This is in stark contrast to the splendorous stock price, which has rocketed 348% since this time a year ago. It's pretty clear the market isn't basing its valuation on fundamental metrics like revenue. While this gain looks like speculative buying to us, sometimes speculation pays off.
The graphic below depicts how earnings and revenue have changed over time (unveil the exact values by clicking on the image).
You can see how its balance sheet has strengthened (or weakened) over time in this free interactive graphic.
A Different Perspective
It's nice to see that Voltatron shareholders have received a total shareholder return of 348% over the last year. That certainly beats the loss of about 0.5% per year over the last half decade. We generally put more weight on the long term performance over the short term, but the recent improvement could hint at a (positive) inflection point within the business. It's always interesting to track share price performance over the longer term. But to understand Voltatron better, we need to consider many other factors. Case in point: We've spotted 3 warning signs for Voltatron you should be aware of, and 1 of them is significant.
If you are like me, then you will not want to miss this free list of undervalued small caps that insiders are buying.
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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