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Did Centrus Energy's (NYSEMKT:LEU) Share Price Deserve to Gain 97%?

Simply Wall St

It hasn't been the best quarter for Centrus Energy Corp. (NYSEMKT:LEU) shareholders, since the share price has fallen 20% in that time. But that doesn't change the fact that the returns over the last year have been pleasing. To wit, it had solidly beat the market, up 97%.

View our latest analysis for Centrus Energy

Centrus Energy isn't currently profitable, so most analysts would look to revenue growth to get an idea of how fast the underlying business is growing. Shareholders of unprofitable companies usually expect strong revenue growth. As you can imagine, fast revenue growth, when maintained, often leads to fast profit growth.

Centrus Energy grew its revenue by 5.2% last year. That's not great considering the company is losing money. In keeping with the revenue growth, the share price gained 97% in that time. While not a huge gain tht seems pretty reasonable. Given the market doesn't seem too excited about the stock, a closer look at the financial data could pay off, if you can find indications of a stronger growth trend in the future.

You can see how earnings and revenue have changed over time in the image below (click on the chart to see the exact values).

AMEX:LEU Income Statement, February 10th 2020

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

A Different Perspective

It's good to see that Centrus Energy has rewarded shareholders with a total shareholder return of 97% in the last twelve months. That's better than the annualised return of 8.1% over half a decade, implying that the company is doing better recently. Given the share price momentum remains strong, it might be worth taking a closer look at the stock, lest you miss an opportunity. 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. Take risks, for example - Centrus Energy has 5 warning signs (and 1 which can't be ignored) we think you should know about.

If you would prefer to check out another company -- one with potentially superior financials -- then do not miss this free list of companies that have proven they can grow earnings.

Please note, the market returns quoted in this article reflect the market weighted average returns of stocks that currently trade on US exchanges.

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.

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