Shareholders Are Thrilled That The Litium (NGM:LITI) Share Price Increased 237%

It might seem bad, but the worst that can happen when you buy a stock (without leverage) is that its share price goes to zero. But when you pick a company that is really flourishing, you can make more than 100%. For example, the Litium AB (publ) (NGM:LITI) share price has soared 237% in the last three years. Most would be happy with that. In more good news, the share price has risen 13% in thirty days. We note that Litium reported its financial results recently; luckily, you can catch up on the latest revenue and profit numbers in our company report.

See our latest analysis for Litium

Because Litium made a loss in the last twelve months, we think the market is probably more focussed on revenue and revenue growth, at least for now. Generally speaking, companies without profits are expected to grow revenue every year, and at a good clip. 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 3 years Litium saw its revenue grow at 24% per year. That's much better than most loss-making companies. Along the way, the share price gained 50% per year, a solid pop by our standards. But it does seem like the market is paying attention to strong revenue growth. Nonetheless, we'd say Litium is still worth investigating - successful businesses can often keep growing for long periods.

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

You can see how its balance sheet has strengthened (or weakened) over time in this free interactive graphic.

A Different Perspective

Pleasingly, Litium's total shareholder return last year was 151%. So this year's TSR was actually better than the three-year TSR (annualized) of 50%. Given the track record of solid returns over varying time frames, it might be worth putting Litium on your watchlist. While it is well worth considering the different impacts that market conditions can have on the share price, there are other factors that are even more important. For instance, we've identified 4 warning signs for Litium that you should be aware of.

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 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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