The Canopy Growth (TSE:WEED) Share Price Gained 2198% And Shareholders Are Jubilant
Investing can be hard but the potential fo an individual stock to pay off big time inspires us. But when you hold the right stock for the right time period, the rewards can be truly huge. For example, the Canopy Growth Corporation (TSE:WEED) share price is up a whopping 2198% in the last three years, a handsome return for long term holders. In the last week shares have slid back 2.9%.
Anyone who held for that rewarding ride would probably be keen to talk about it.
View our latest analysis for Canopy Growth
Canopy Growth isn't a profitable company, so 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. Some companies are willing to postpone profitability to grow revenue faster, but in that case one does expect good top-line growth.
Canopy Growth's revenue trended up 72% each year over three years. That's well above most pre-profit companies. In light of this attractive revenue growth, it seems somewhat appropriate that the share price has been rocketing, boasting a gain of 184% per year, over the same period. It's always tempting to take profits after a share price gain like that, but high-growth companies like Canopy Growth can sometimes sustain strong growth for many years. So we'd recommend you take a closer look at this one, or even put it on your watchlist.
The graphic below shows how revenue and earnings have changed as management guided the business forward. If you want to see cashflow, you can click on the chart.
We like that insiders have been buying shares in the last twelve months. Having said that, most people consider earnings and revenue growth trends to be a more meaningful guide to the business. If you are thinking of buying or selling Canopy Growth stock, you should check out this free report showing analyst profit forecasts.
A Different Perspective
It's nice to see that Canopy Growth shareholders have received a total shareholder return of 89% over the last year. Since the one-year TSR is better than the five-year TSR (the latter coming in at 76% per year), it would seem that the stock's performance has improved in recent times. Someone with an optimistic perspective could view the recent improvement in TSR as indicating that the business itself is getting better with time. Investors who like to make money usually check up on insider purchases, such as the price paid, and total amount bought. You can find out about the insider purchases of Canopy Growth by clicking this link.
Canopy Growth is not the only stock that insiders are buying. For those who like to find winning investments this free list of growing companies with recent insider purchasing, could be just the ticket.
Please note, the market returns quoted in this article reflect the market weighted average returns of stocks that currently trade on CA exchanges.
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If you spot an error that warrants correction, please contact the editor at editorial-team@simplywallst.com. 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. Simply Wall St has no position in the stocks mentioned. Thank you for reading.
