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Some Voyager Digital Ltd. (TSE:VOYG) shareholders are probably rather concerned to see the share price fall 72% over the last three months. But that doesn't change the fact that the returns over the last three years have been spectacular. The longer term view reveals that the share price is up 772% in that period. As long term investors the recent fall doesn't detract all that much from the longer term story. Only time will tell if there is still too much optimism currently reflected in the share price. It really delights us to see such great share price performance for investors.
Since the long term performance has been good but there's been a recent pullback of 23%, let's check if the fundamentals match the share price.
Voyager Digital 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. As you can imagine, fast revenue growth, when maintained, often leads to fast profit growth.
Voyager Digital's revenue trended up 134% each year over three years. That's much better than most loss-making companies. And it's not just the revenue that is taking off. The share price is up 106% per year in that time. Despite the strong run, top performers like Voyager Digital have been known to go on winning for decades. In fact, it might be time to put it on your watchlist, if you're not already familiar with the stock.
The graphic below depicts how earnings and revenue have changed over time (unveil the exact values by clicking on the image).
It's probably worth noting we've seen significant insider buying in the last quarter, which we consider a positive. That said, we think earnings and revenue growth trends are even more important factors to consider. You can see what analysts are predicting for Voyager Digital in this interactive graph of future profit estimates.
A Different Perspective
Voyager Digital shareholders are down 87% for the year, but the broader market is up 7.2%. However, keep in mind that even the best stocks will sometimes underperform the market over a twelve month period. Fortunately the longer term story is brighter, with total returns averaging about 106% per year over three years. The recent sell-off could be an opportunity if the business remains sound, so it may be worth checking the fundamental data for signs of a long-term growth trend. It's always interesting to track share price performance over the longer term. But to understand Voyager Digital better, we need to consider many other factors. To that end, you should be aware of the 2 warning signs we've spotted with Voyager Digital .
If you like to buy stocks alongside management, then you might just love this free list of companies. (Hint: insiders have been buying them).
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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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.