The Gaussin (EPA:ALGAU) Share Price Has Soared 748%, Delighting Many Shareholders

While some are satisfied with an index fund, active investors aim to find truly magnificent investments on the stock market. While not every stock performs well, when investors win, they can win big. For example, Gaussin SA (EPA:ALGAU) has generated a beautiful 748% return in just a single year. It's even up 19% in the last week. Also impressive, the stock is up 131% over three years, making long term shareholders happy, too.

It really delights us to see such great share price performance for investors.

See our latest analysis for Gaussin

Given that Gaussin 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. Shareholders of unprofitable companies usually expect strong revenue growth. Some companies are willing to postpone profitability to grow revenue faster, but in that case one does expect good top-line growth.

Gaussin actually shrunk its revenue over the last year, with a reduction of 47%. This is in stark contrast to the splendorous stock price, which has rocketed 748% 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.

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

This free interactive report on Gaussin's balance sheet strength is a great place to start, if you want to investigate the stock further.

A Different Perspective

It's nice to see that Gaussin shareholders have received a total shareholder return of 748% over the last year. Notably the five-year annualised TSR loss of 3% per year compares very unfavourably with the recent share price performance. This makes us a little wary, but the business might have turned around its fortunes. It's always interesting to track share price performance over the longer term. But to understand Gaussin better, we need to consider many other factors. Consider risks, for instance. Every company has them, and we've spotted 2 warning signs for Gaussin you should know about.

If you are like me, then you will not want to miss this free list of growing companies 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 FR 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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