Cutera (NASDAQ:CUTR) delivers shareholders splendid 36% CAGR over 3 years, surging 11% in the last week alone

By
Simply Wall St
Published
March 21, 2022
NasdaqGS:CUTR
Source: Shutterstock

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 in contrast you can make much more than 100% if the company does well. To wit, the Cutera, Inc. (NASDAQ:CUTR) share price has flown 150% in the last three years. Most would be happy with that. And in the last month, the share price has gained 33%. We note that Cutera reported its financial results recently; luckily, you can catch up on the latest revenue and profit numbers in our company report.

On the back of a solid 7-day performance, let's check what role the company's fundamentals have played in driving long term shareholder returns.

Check out our latest analysis for Cutera

Given that Cutera only made minimal earnings in the last twelve months, we'll focus on revenue to gauge its business development. Generally speaking, we'd consider a stock like this alongside loss-making companies, simply because the quantum of the profit is so low. It would be hard to believe in a more profitable future without growing revenues.

Cutera's revenue trended up 8.1% each year over three years. That's pretty nice growth. It's fair to say that the market has acknowledged the growth by pushing the share price up 36% per year. It's hard to value pre-profit businesses, but it seems like the market has become a lot more optimistic about this one! It would be worth thinking about when profits will flow, since that milestone will attract more attention.

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

earnings-and-revenue-growth
NasdaqGS:CUTR Earnings and Revenue Growth March 21st 2022

It's good to see that there was some significant insider buying in the last three months. That's a positive. That said, we think earnings and revenue growth trends are even more important factors to consider. So it makes a lot of sense to check out what analysts think Cutera will earn in the future (free profit forecasts).

A Different Perspective

It's nice to see that Cutera shareholders have received a total shareholder return of 48% over the last year. That gain is better than the annual TSR over five years, which is 18%. Therefore it seems like sentiment around the company has been positive lately. In the best case scenario, this may hint at some real business momentum, implying that now could be a great time to delve deeper. It's always interesting to track share price performance over the longer term. But to understand Cutera better, we need to consider many other factors. For instance, we've identified 3 warning signs for Cutera that you should be aware of.

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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