Can You Imagine How Gentian Diagnostics' (OB:GENT) Shareholders Feel About The 57% Share Price Increase?

By buying an index fund, you can roughly match the market return with ease. But if you pick the right individual stocks, you could make more than that. For example, the Gentian Diagnostics AS (OB:GENT) share price is up 57% in the last three years, clearly besting the market return of around 8.7% (not including dividends).

Check out our latest analysis for Gentian Diagnostics

Given that Gentian Diagnostics 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. As you can imagine, fast revenue growth, when maintained, often leads to fast profit growth.

Over the last three years Gentian Diagnostics has grown its revenue at 25% annually. That's much better than most loss-making companies. The share price rise of 16% per year throughout that time is nice to see, and given the revenue growth, that gain seems somewhat justified. So now might be the perfect time to put Gentian Diagnostics on your radar. If the company is trending towards profitability then it could be very interesting.

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

Take a more thorough look at Gentian Diagnostics' financial health with this free report on its balance sheet.

A Different Perspective

Gentian Diagnostics shareholders are up 49% for the year. It's always nice to make money but this return falls short of the market return which was about 64% for the year. On the other hand, the TSR over three years was worse, at just 16% per year. This suggests the company's position is improving. If the business can justify the share price gain with improving fundamental data, then there could be more gains to come. Most investors take the time to check the data on insider transactions. You can click here to see if insiders have been buying or selling.

Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of companies we expect will grow earnings.

Please note, the market returns quoted in this article reflect the market weighted average returns of stocks that currently trade on NO 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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