Loungers (LON:LGRS) Shareholders Booked A 10% Gain In The Last Year

These days it's easy to simply buy an index fund, and your returns should (roughly) match the market. But investors can boost returns by picking market-beating companies to own shares in. For example, the Loungers plc (LON:LGRS) share price is up 10% in the last year, clearly besting the market decline of around 9.1% (not including dividends). If it can keep that out-performance up over the long term, investors will do very well! We'll need to follow Loungers 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 Loungers

Loungers 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. 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.

In the last year Loungers saw its revenue grow by 8.9%. That's not great considering the company is losing money. In keeping with the revenue growth, the share price gained 10% in that time. That's not a standout result, but it is solid - much like the level of revenue growth. It could be worth keeping an eye on this one, especially if growth accelerates.

The company's revenue and earnings (over time) are depicted in the image below (click to see the exact numbers).

We consider it positive that insiders have made significant purchases in the last year. Even so, future earnings will be far more important to whether current shareholders make money. So we recommend checking out this free report showing consensus forecasts

A Different Perspective

Loungers boasts a total shareholder return of 10% for the last year. A substantial portion of that gain has come in the last three months, with the stock up 65% in that time. Demand for the stock from multiple parties is pushing the price higher; it could be that word is getting out about its virtues as a business. 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. For instance, we've identified 3 warning signs for Loungers (1 shouldn't be ignored) that you should be aware of.

There are plenty of other companies that have insiders buying up shares. You probably do 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 GB exchanges.

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