Maxar Technologies (NYSE:MAXR) Shareholders Have Enjoyed A Whopping 356% Share Price Gain

It might be of some concern to shareholders to see the Maxar Technologies Inc. (NYSE:MAXR) share price down 22% in the last month. But that doesn't change the fact that the returns over the last year have been spectacular. In that time, shareholders have had the pleasure of a 356% boost to the share price. So it is not that surprising to see the stock retrace a little. The real question is whether the fundamental business performance can justify the strong increase over the long term.

See our latest analysis for Maxar Technologies

Given that Maxar Technologies 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. When a company doesn't make profits, we'd generally expect to see good revenue growth. 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 year Maxar Technologies saw its revenue grow by 3.5%. That's not great considering the company is losing money. So the 356% gain in just twelve months is completely unexpected. We're happy that investors have made money, but we can't help questioning whether the rise is sustainable. This is an example of the huge profits some lucky shareholders occasionally make on growth stocks.

The image below shows how earnings and revenue have tracked over time (if you click on the image you can see greater detail).

We consider it positive that insiders have made significant purchases in the last year. Even so, future earnings will be far more important to whether current shareholders make money. This free report showing analyst forecasts should help you form a view on Maxar Technologies

A Different Perspective

It's nice to see that Maxar Technologies shareholders have received a total shareholder return of 357% over the last year. Of course, that includes the dividend. There's no doubt those recent returns are much better than the TSR loss of 6% per year over five years. We generally put more weight on the long term performance over the short term, but the recent improvement could hint at a (positive) inflection point within the business. It's always interesting to track share price performance over the longer term. But to understand Maxar Technologies better, we need to consider many other factors. Consider risks, for instance. Every company has them, and we've spotted 3 warning signs for Maxar Technologies you should know about.

If you like to buy stocks alongside management, then you might just love this free list of companies. (Hint: insiders have been buying them).

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