Stock Analysis

Fractal Gaming Group (STO:FRACTL) shareholder returns have been decent, earning 54% in 1 year

Published
OM:FRACTL

Passive investing in index funds can generate returns that roughly match the overall market. But if you pick the right individual stocks, you could make more than that. To wit, the Fractal Gaming Group AB (publ) (STO:FRACTL) share price is 54% higher than it was a year ago, much better than the market decline of around 2.9% (not including dividends) in the same period. If it can keep that out-performance up over the long term, investors will do very well! Fractal Gaming Group hasn't been listed for long, so it's still not clear if it is a long term winner.

Since it's been a strong week for Fractal Gaming Group shareholders, let's have a look at trend of the longer term fundamentals.

View our latest analysis for Fractal Gaming Group

There is no denying that markets are sometimes efficient, but prices do not always reflect underlying business performance. One imperfect but simple way to consider how the market perception of a company has shifted is to compare the change in the earnings per share (EPS) with the share price movement.

During the last year Fractal Gaming Group grew its earnings per share, moving from a loss to a profit.

When a company has just transitioned to profitability, earnings per share growth is not always the best way to look at the share price action.

We think that the revenue growth of 32% could have some investors interested. We do see some companies suppress earnings in order to accelerate revenue growth.

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

OM:FRACTL Earnings and Revenue Growth August 12th 2023

We know that Fractal Gaming Group has improved its bottom line lately, but what does the future have in store? You can see what analysts are predicting for Fractal Gaming Group in this interactive graph of future profit estimates.

A Different Perspective

Fractal Gaming Group shareholders should be happy with the total gain of 54% over the last twelve months. And the share price momentum remains respectable, with a gain of 24% 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. 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 example, we've discovered 2 warning signs for Fractal Gaming Group (1 makes us a bit uncomfortable!) that you should be aware of before investing here.

Of course Fractal Gaming Group may not be the best stock to buy. So you may wish to see this free collection of growth stocks.

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

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. 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.