Shareholders have faith in loss-making Arlo Technologies (NYSE:ARLO) as stock climbs 7.4% in past week, taking one-year gain to 182%

Unless you borrow money to invest, the potential losses are limited. But if you pick the right business to buy shares in, you can make more than you can lose. For example, the Arlo Technologies, Inc. (NYSE:ARLO) share price has soared 182% in the last 1 year. Most would be very happy with that, especially in just one year! We note the stock price is up 7.4% in the last seven days. And shareholders have also done well over the long term, with an increase of 38% in the last three years.

The past week has proven to be lucrative for Arlo Technologies investors, so let's see if fundamentals drove the company's one-year performance.

See our latest analysis for Arlo Technologies

Because Arlo Technologies 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 expect to see good 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.

Arlo Technologies actually shrunk its revenue over the last year, with a reduction of 7.8%. We're a little surprised to see the share price pop 182% in the last year. It just goes to show the market doesn't always pay attention to the reported numbers. Of course, it could be that the market expected this revenue drop.

The company's revenue and earnings (over time) are depicted in the image below (click to see the exact numbers).

If you are thinking of buying or selling Arlo Technologies stock, you should check out this FREE detailed report on its balance sheet.

A Different Perspective

We're pleased to report that Arlo Technologies shareholders have received a total shareholder return of 182% over one year. That gain is better than the annual TSR over five years, which is 0.7%. Therefore it seems like sentiment around the company has been positive lately. Someone with an optimistic perspective could view the recent improvement in TSR as indicating that the business itself is getting better with time. 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 1 warning sign with Arlo Technologies , 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.