Want to participate in a short research study? Help shape the future of investing tools and you could win a $250 gift card!
The simplest way to invest in stocks is to buy exchange traded funds. But investors can boost returns by picking market-beating companies to own shares in. To wit, the Quotient Limited (NASDAQ:QTNT) share price is 88% higher than it was a year ago, much better than the market return of around 7.8% (not including dividends) in the same period. If it can keep that out-performance up over the long term, investors will do very well! On the other hand, longer term shareholders have had a tougher run, with the stock falling 5.2% in three years.
Quotient isn’t a profitable company, so it is unlikely we’ll see a strong correlation between its share price and its earnings per share (EPS). Arguably revenue is our next best option. Shareholders of unprofitable companies usually expect strong revenue growth. That’s because it’s hard to be confident a company will be sustainable if revenue growth is negligible, and it never makes a profit.
Quotient grew its revenue by 12% last year. That’s not a very high growth rate considering it doesn’t make profits. In keeping with the revenue growth, the share price gained 88% in that time. That’s not a standout result, but it is solid – much like the level of revenue growth. It could be worth keeping an eye on this one, especially if growth accelerates.
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.
We’re pleased to report that the CEO is remunerated more modestly than most CEOs at similarly capitalized companies. But while CEO remuneration is always worth checking, the really important question is whether the company can grow earnings going forward. If you are thinking of buying or selling Quotient stock, you should check out this free report showing analyst profit forecasts.
A Different Perspective
It’s nice to see that Quotient shareholders have gained 88% (in total) over the last year. What is absolutely clear is that is far preferable to the dismal 1.8% average annual loss suffered over the last three years. We’re generally cautious about putting too much weigh on shorter term data, but the recent improvement is definitely a positive. If you would like to research Quotient in more detail then you might want to take a look at whether insiders have been buying or selling shares in the company.
If you are like me, then you will not want to miss this free list of growing companies that insiders are buying.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 firstname.lastname@example.org. 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.