BTCS (NASDAQ:BTCS) jumps 20% this week, taking one-year gains to 397%

While some are satisfied with an index fund, active investors aim to find truly magnificent investments on the stock market. While not every stock performs well, when investors win, they can win big. In the case of BTCS Inc. (NASDAQ:BTCS), the share price is up an incredible 392% in the last year alone. Also pleasing for shareholders was the 39% gain in the last three months. And shareholders have also done well over the long term, with an increase of 343% in the last three years.

Since the stock has added US$47m to its market cap in the past week alone, let's see if underlying performance has been driving long-term returns.

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BTCS wasn't profitable in the last twelve months, 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. Generally speaking, companies without profits are expected to grow revenue every year, and at a good clip. That's because fast revenue growth can be easily extrapolated to forecast profits, often of considerable size.

In the last year BTCS saw its revenue grow by 355%. That's well above most other pre-profit companies. But the share price has really rocketed in response gaining 392% as previously mentioned. Despite the strong growth, it's certainly possible the market has gotten a little over-excited. But if the share price does moderate a bit, there might be an opportunity for high growth investors.

The graphic below depicts how earnings and revenue have changed over time (unveil the exact values by clicking on the image).

Balance sheet strength is crucial. It might be well worthwhile taking a look at our free report on how its financial position has changed over time.

What About Dividends?

When looking at investment returns, it is important to consider the difference between total shareholder return (TSR) and share price return. Whereas the share price return only reflects the change in the share price, the TSR includes the value of dividends (assuming they were reinvested) and the benefit of any discounted capital raising or spin-off. It's fair to say that the TSR gives a more complete picture for stocks that pay a dividend. As it happens, BTCS' TSR for the last 1 year was 397%, which exceeds the share price return mentioned earlier. This is largely a result of its dividend payments!

A Different Perspective

It's nice to see that BTCS shareholders have received a total shareholder return of 397% over the last year. And that does include the dividend. That's better than the annualised return of 29% 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. It's always interesting to track share price performance over the longer term. But to understand BTCS better, we need to consider many other factors. Case in point: We've spotted 4 warning signs for BTCS you should be aware of, and 2 of them don't sit too well with us.

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.