Zordix (NGM:ZORDIX B) Has Gifted Shareholders With A Fantastic 229% Total Return On Their Investment

When you buy shares in a company, there is always a risk that the price drops to zero. But if you pick the right business to buy shares in, you can make more than you can lose. For example, the Zordix AB (publ) (NGM:ZORDIX B) share price has soared 201% return in just a single year. On top of that, the share price is up 49% in about a quarter. Note that businesses generally develop over the long term, so the returns over the last year might not reflect a long term trend.

Check out our latest analysis for Zordix

We don't think that Zordix's modest trailing twelve month profit has the market's full attention at the moment. We think revenue is probably a better guide. Generally speaking, we'd consider a stock like this alongside loss-making companies, simply because the quantum of the profit is so low. For shareholders to have confidence a company will grow profits significantly, it must grow revenue.

In the last year Zordix saw its revenue grow by 86%. That's stonking growth even when compared to other loss-making stocks. And the share price has responded, gaining 201% 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.

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

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

What about the Total Shareholder Return (TSR)?

We'd be remiss not to mention the difference between Zordix's total shareholder return (TSR) and its share price return. The TSR is a return calculation that accounts for the value of cash dividends (assuming that any dividend received was reinvested) and the calculated value of any discounted capital raisings and spin-offs. Zordix hasn't been paying dividends, but its TSR of 229% exceeds its share price return of 201%, implying it has either spun-off a business, or raised capital at a discount; thereby providing additional value to shareholders.

A Different Perspective

Zordix boasts a total shareholder return of 229% for the last year. And the share price momentum remains respectable, with a gain of 49% in the last three months. 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. It's always interesting to track share price performance over the longer term. But to understand Zordix better, we need to consider many other factors. Case in point: We've spotted 5 warning signs for Zordix you should be aware of, and 1 of them is a bit unpleasant.

We will like Zordix better if we see some big insider buys. While we wait, check out this free list of growing companies with considerable, recent, insider buying.

Please note, the market returns quoted in this article reflect the market weighted average returns of stocks that currently trade on SE 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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