If You Had Bought Prolific Technology (GTSM:6233) Shares Three Years Ago You'd Have Earned 222% Returns

The most you can lose on any stock (assuming you don't use leverage) is 100% of your money. But when you pick a company that is really flourishing, you can make more than 100%. For example, the Prolific Technology Inc. (GTSM:6233) share price has soared 222% in the last three years. How nice for those who held the stock! It's also good to see the share price up 32% over the last quarter. But this move may well have been assisted by the reasonably buoyant market (up 16% in 90 days).

Check out our latest analysis for Prolific Technology

While Prolific Technology made a small profit, in the last year, we think that the market is probably more focussed on the top line growth at the moment. 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 3 years Prolific Technology saw its revenue shrink by 6.8% per year. So we wouldn't have expected the share price to gain 48% per year, but it has. It's fair to say shareholders are definitely counting on a bright future.

The graphic below depicts how earnings and revenue have changed over time (unveil the exact values by clicking on the image).

Take a more thorough look at Prolific Technology's financial health with this free report on its balance sheet.

A Different Perspective

We're pleased to report that Prolific Technology shareholders have received a total shareholder return of 128% over one year. That's better than the annualised return of 20% over half a decade, implying that the company is doing better recently. Someone with an optimistic perspective could view the recent improvement in TSR as indicating that the business itself is getting better with time. It's always interesting to track share price performance over the longer term. But to understand Prolific Technology better, we need to consider many other factors. Even so, be aware that Prolific Technology is showing 2 warning signs in our investment analysis , you should know about...

If you would prefer to check out another company -- one with potentially superior financials -- then do not miss this free list of companies that have proven they can grow earnings.

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