Did Business Growth Power Vireo Health International's (CSE:VREO) Share Price Gain of 127%?

Unfortunately, investing is risky - companies can and do go bankrupt. But if you pick the right business to buy shares in, you can make more than you can lose. For example, the Vireo Health International, Inc. (CSE:VREO) share price has soared 127% in the last year. Most would be very happy with that, especially in just one year! It's up an even more impressive 153% over the last quarter. We'll need to follow Vireo Health International for a while to get a better sense of its share price trend, since it hasn't been listed for particularly long.

See our latest analysis for Vireo Health International

Vireo Health International isn't currently profitable, so most analysts would look to revenue growth to get an idea of how fast the underlying business is growing. Shareholders of unprofitable companies usually expect strong revenue growth. That's because fast revenue growth can be easily extrapolated to forecast profits, often of considerable size.

In the last year Vireo Health International saw its revenue grow by 78%. That's a head and shoulders above most loss-making companies. And the share price has responded, gaining 127% as we previously mentioned. That sort of revenue growth is bound to attract attention, even if the company doesn't turn a profit. Given the positive sentiment around the stock we're cautious, but there's no doubt its worth watching.

The image below shows how earnings and revenue have tracked over time (if you click on the image you can see greater detail).

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. This free report showing analyst forecasts should help you form a view on Vireo Health International

A Different Perspective

Vireo Health International shareholders should be happy with the total gain of 127% over the last twelve months. A substantial portion of that gain has come in the last three months, with the stock up 153% in that time. This suggests the company is continuing to win over new investors. I find it very interesting to look at share price over the long term as a proxy for business performance. But to truly gain insight, we need to consider other information, too. Consider for instance, the ever-present spectre of investment risk. We've identified 5 warning signs with Vireo Health International (at least 1 which is a bit concerning) , and understanding them should be part of your investment process.

Vireo Health International 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 CA 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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