Does Westlife Development's (NSE:WESTLIFE) Share Price Gain of 32% Match Its Business Performance?

These days it's easy to simply buy an index fund, and your returns should (roughly) match the market. But you can significantly boost your returns by picking above-average stocks. For example, the Westlife Development Limited (NSE:WESTLIFE) share price is up 32% in the last year, clearly besting the market return of around 7.7% (not including dividends). So that should have shareholders smiling. We'll need to follow Westlife Development for a while to get a better sense of its share price trend, since it hasn't been listed for particularly long.

View our latest analysis for Westlife Development

Westlife Development wasn't profitable in the last twelve months, it is unlikely we'll see a strong correlation between its share price and its earnings per share (EPS). Arguably revenue is our next best option. Generally speaking, companies without profits are expected to grow revenue every year, and at a good clip. That's because fast revenue growth can be easily extrapolated to forecast profits, often of considerable size.

In the last year Westlife Development saw its revenue shrink by 13%. The stock is up 32% in that time, a fine performance given the revenue drop. We can correlate the share price rise with revenue or profit growth, but it seems the market had previously expected weaker results, and sentiment around the stock is improving.

You can see below how earnings and revenue have changed over time (discover the exact values by clicking on the image).

It's probably worth noting we've seen significant insider buying in the last quarter, which we consider a positive. That said, we think earnings and revenue growth trends are even more important factors to consider. If you are thinking of buying or selling Westlife Development stock, you should check out this free report showing analyst profit forecasts.

A Different Perspective

Westlife Development boasts a total shareholder return of 32% for the last year. A substantial portion of that gain has come in the last three months, with the stock up 30% in that time. This suggests the company is continuing to win over new investors. It's always interesting to track share price performance over the longer term. But to understand Westlife Development better, we need to consider many other factors. For example, we've discovered 1 warning sign for Westlife Development that you should be aware of before investing here.

If you like to buy stocks alongside management, then you might just love this free list of companies. (Hint: insiders have been buying them).

Please note, the market returns quoted in this article reflect the market weighted average returns of stocks that currently trade on IN exchanges.

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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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