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Facedrive Inc. (CVE:FD) shareholders might understandably be very concerned that the share price has dropped 48% in the last quarter. Despite this, the stock is a strong performer over the last year, no doubt about that. Indeed, the share price is up an impressive 276% in that time. So we think most shareholders won't be too upset about the recent fall. More important, going forward, is how the business itself is going.
Facedrive 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 expect to see good revenue growth. That's because fast revenue growth can be easily extrapolated to forecast profits, often of considerable size.
Over the last twelve months, Facedrive's revenue grew by 552%. That's a head and shoulders above most loss-making companies. Meanwhile, the market has paid attention, sending the share price soaring 276% in response. That sort of revenue growth is bound to attract attention, even if the company doesn't turn a profit. The strong share price rise indicates optimism, so there may be a better opportunity for buyers as the hype fades a bit.
The graphic below depicts how earnings and revenue have changed over time (unveil the exact values by clicking on the image).
We consider it positive that insiders have made significant purchases in the last year. Even so, future earnings will be far more important to whether current shareholders make money. Dive deeper into the earnings by checking this interactive graph of Facedrive's earnings, revenue and cash flow.
A Different Perspective
It's nice to see that Facedrive shareholders have gained 276% over the last year. We regret to report that the share price is down 48% over ninety days. It may simply be that the share price got ahead of itself, although there may have been fundamental developments that are weighing on it. 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 risks, for instance. Every company has them, and we've spotted 3 warning signs for Facedrive you should know about.
Facedrive is not the only stock insiders are buying. So take a peek at this free list of growing companies with insider buying.
Please note, the market returns quoted in this article reflect the market weighted average returns of stocks that currently trade on CA exchanges.
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. 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.
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