Research Frontiers (NASDAQ:REFR) shareholders are still up 66% over 1 year despite pulling back 10% in the past week

The Research Frontiers Incorporated (NASDAQ:REFR) share price has had a bad week, falling 10%. But looking back over the last year, the returns have actually been rather pleasing! To wit, it had solidly beat the market, up 66%.

While this past week has detracted from the company's one-year return, let's look at the recent trends of the underlying business and see if the gains have been in alignment.

Check out our latest analysis for Research Frontiers

Research Frontiers isn't currently profitable, so most analysts would look to revenue growth to get an idea of how fast the underlying business is growing. 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 Research Frontiers saw its revenue grow by 79%. That's well above most other pre-profit companies. The solid 66% share price gain goes down pretty well, but it's not necessarily as good as you might expect given the top notch revenue growth. If that's the case, now might be the time to take a close look at Research Frontiers. Human beings have trouble conceptualizing (and valuing) exponential growth. Is that what we're seeing here?

The image below shows how earnings and revenue have tracked over time (if you click on the image you can see greater detail).

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

A Different Perspective

We're pleased to report that Research Frontiers shareholders have received a total shareholder return of 66% over one year. That certainly beats the loss of about 6% per year over the last half decade. This makes us a little wary, but the business might have turned around its fortunes. I find it very interesting to look at share price over the long term as a proxy for business performance. But to truly gain insight, we need to consider other information, too. Consider for instance, the ever-present spectre of investment risk. We've identified 2 warning signs with Research Frontiers , and understanding them should be part of your investment process.

Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of companies we expect will 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.