Despite currently being unprofitable, Questerre Energy (TSE:QEC) has delivered a 35% return to shareholders over 3 years

Questerre Energy Corporation (TSE:QEC) shareholders might be concerned after seeing the share price drop 18% in the last week. But that shouldn't obscure the pleasing returns achieved by shareholders over the last three years. To wit, the share price did better than an index fund, climbing 35% during that period.

Since the long term performance has been good but there's been a recent pullback of 18%, let's check if the fundamentals match the share price.

View our latest analysis for Questerre Energy

Questerre Energy 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. As you can imagine, fast revenue growth, when maintained, often leads to fast profit growth.

Over the last three years Questerre Energy has grown its revenue at 17% annually. That's pretty nice growth. While the share price has done well, compounding at 11% yearly, over three years, that move doesn't seem over the top. If that's the case, then it could be well worth while to research the growth trajectory. Of course, it's always worth considering funding risks when a company isn't profitable.

You can see how earnings and revenue have changed over time in the image below (click on the chart to see the exact values).

Take a more thorough look at Questerre Energy's financial health with this free report on its balance sheet.

A Different Perspective

Questerre Energy's TSR for the year was broadly in line with the market average, at 12%. That gain looks pretty satisfying, and it is even better than the five-year TSR of 1.8% per year. Even if the share price growth slows down from here, there's a good chance that this is business worth watching in the long term. It's always interesting to track share price performance over the longer term. But to understand Questerre Energy better, we need to consider many other factors. Even so, be aware that Questerre Energy is showing 2 warning signs in our investment analysis , you should know about...

For those who like to find winning investments this free list of undervalued 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 Canadian exchanges.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. 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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com