Does iCAD's (NASDAQ:ICAD) Share Price Gain of 87% Match Its Business Performance?

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These days it's easy to simply buy an index fund, and your returns should (roughly) match the market. But investors can boost returns by picking market-beating companies to own shares in. To wit, the iCAD, Inc. (NASDAQ:ICAD) share price is 87% higher than it was a year ago, much better than the market return of around 2.8% (not including dividends) in the same period. If it can keep that out-performance up over the long term, investors will do very well! The longer term returns have not been as good, with the stock price only 12% higher than it was three years ago.

View our latest analysis for iCAD

Because iCAD is loss-making, we think the market is probably more focussed on revenue and revenue growth, at least for now. Shareholders of unprofitable companies usually expect strong revenue growth. That's because fast revenue growth can be easily extrapolated to forecast profits, often of considerable size.

In the last year iCAD saw its revenue shrink by 5.6%. Despite the lack of revenue growth, the stock has returned a solid 87% the last twelve months. We can correlate the share price rise with revenue or profit growth, but it seems the market had previously expected weaker results, and sentiment around the stock is improving.

Depicted in the graphic below, you'll see revenue and earnings over time. If you want more detail, you can click on the chart itself.

You can see how its balance sheet has strengthened (or weakened) over time in this free interactive graphic.

A Different Perspective

It's nice to see that iCAD shareholders have received a total shareholder return of 87% over the last year. That certainly beats the loss of about 1.1% per year over the last half decade. This makes us a little wary, but the business might have turned around its fortunes. You could get a better understanding of iCAD's growth by checking out this more detailed historical graph of earnings, revenue and cash flow.

But note: iCAD may not be the best stock to buy. So take a peek at this free list of interesting companies with past earnings growth (and further growth forecast).

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

We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.

If you spot an error that warrants correction, please contact the editor at editorial-team@simplywallst.com. 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. Simply Wall St has no position in the stocks mentioned. Thank you for reading.