The one-year returns have been impressive for Citi Trends (NASDAQ:CTRN) shareholders despite underlying losses increasing

The most you can lose on any stock (assuming you don't use leverage) is 100% of your money. But if you pick the right stock, you can make a lot more than 100%. Take, for example Citi Trends, Inc. (NASDAQ:CTRN). Its share price is already up an impressive 154% in the last twelve months. On top of that, the share price is up 39% in about a quarter. And shareholders have also done well over the long term, with an increase of 78% in the last three years.

Since it's been a strong week for Citi Trends shareholders, let's have a look at trend of the longer term fundamentals.

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Because Citi Trends 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. When a company doesn't make profits, we'd generally hope to see good revenue growth. Some companies are willing to postpone profitability to grow revenue faster, but in that case one would hope for good top-line growth to make up for the lack of earnings.

In the last year Citi Trends saw its revenue grow by 1.9%. That's not great considering the company is losing money. So we wouldn't have expected the share price to rise by 154%. The business will need a lot more growth to justify that increase. It's quite likely that the market is considering other factors, not just revenue growth.

You can see below how earnings and revenue have changed over time (discover the exact values by clicking on the image).

This free interactive report on Citi Trends' balance sheet strength is a great place to start, if you want to investigate the stock further.

A Different Perspective

It's nice to see that Citi Trends shareholders have received a total shareholder return of 154% over the last year. That's better than the annualised return of 12% over half a decade, implying that the company is doing better recently. Someone with an optimistic perspective could view the recent improvement in TSR as indicating that the business itself is getting better with time. If you would like to research Citi Trends 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 would prefer to check out another company -- one with potentially superior financials -- then do not miss this free list of companies that have proven they can grow earnings.

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.