Barfresh Food Group (NASDAQ:BRFH) surges 60% this week, taking one-year gains to 161%

Unfortunately, investing is risky - companies can and do go bankrupt. But if you pick the right business to buy shares in, you can make more than you can lose. For example, the Barfresh Food Group, Inc. (NASDAQ:BRFH) share price had more than doubled in just one year - up 161%. Better yet, the share price has gained 237% in the last quarter. Zooming out, the stock is actually down 43% in the last three years.

The past week has proven to be lucrative for Barfresh Food Group investors, so let's see if fundamentals drove the company's one-year performance.

See our latest analysis for Barfresh Food Group

Because Barfresh Food Group 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. Shareholders of unprofitable companies usually desire strong revenue growth. That's because fast revenue growth can be easily extrapolated to forecast profits, often of considerable size.

Barfresh Food Group grew its revenue by 1.6% last year. That's not great considering the company is losing money. So we wouldn't have expected the share price to rise by 161%. We're happy that investors have made money, though we wonder if the increase will be sustained. We're not so sure that revenue growth is driving the market optimism about the stock.

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

If you are thinking of buying or selling Barfresh Food Group stock, you should check out this FREE detailed report on its balance sheet.

A Different Perspective

It's nice to see that Barfresh Food Group shareholders have received a total shareholder return of 161% over the last year. That certainly beats the loss of about 6% per year over the last half decade. 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. 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. Consider for instance, the ever-present spectre of investment risk. We've identified 5 warning signs with Barfresh Food Group (at least 2 which are concerning) , and understanding them should be part of your investment process.

Of course Barfresh Food 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 American 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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com