Did You Miss Freelancer’s 65% Share Price Gain?

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Freelancer Limited (ASX:FLN) shareholders might be concerned after seeing the share price drop 22% in the last month. But that doesn’t change the fact that the returns over the last year have been pleasing. To wit, it had solidly beat the market, up 65%.

View our latest analysis for Freelancer

Because Freelancer is loss-making, we think the market is probably more focussed on revenue and revenue growth, at least for now. When a company doesn’t yet make profits, we’d generally expect to see good revenue growth. That’s because fast revenue growth can be easily extrapolated to forecast profits, often of considerable size.

Over the last twelve months, Freelancer’s revenue grew by 3.1%. That’s not great considering the company is losing money. The modest growth is probably largely reflected in the share price, which is up 65%. While not a huge gain tht seems pretty reasonable. Given the market doesn’t seem too excited about the stock, a closer look at the financial data could pay off, if you can find indications of a stronger growth trend in the future.

The graphic below shows how revenue and earnings have changed as management guided the business forward. If you want to see cashflow, you can click on the chart.

ASX:FLN Income Statement, February 21st 2019
ASX:FLN Income Statement, February 21st 2019

We like that insiders have been buying shares in the last twelve months. Even so, future earnings will be far more important to whether current shareholders make money. So it makes a lot of sense to check out what analysts think Freelancer will earn in the future (free profit forecasts)

A Different Perspective

It’s good to see that Freelancer has rewarded shareholders with a total shareholder return of 65% in the last twelve months. There’s no doubt those recent returns are much better than the TSR loss of 15% per year over five years. 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. Investors who like to make money usually check up on insider purchases, such as the price paid, and total amount bought. You can find out about the insider purchases of Freelancer by clicking this link.

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 AU exchanges.

We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.

If you spot an error that warrants correction, please contact the editor at editorial-team@simplywallst.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. Thank you for reading.