The simplest way to invest in stocks is to buy exchange traded funds. But investors can boost returns by picking market-beating companies to own shares in. To wit, the BlackLine, Inc. (NASDAQ:BL) share price is 20% higher than it was a year ago, much better than the market return of around 2.6% (not including dividends) in the same period. So that should have shareholders smiling. BlackLine hasn't been listed for long, so it's still not clear if it is a long term winner.
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Given that BlackLine didn't make a profit in the last twelve months, we'll focus on revenue growth to form a quick view of its business development. Shareholders of unprofitable companies usually expect strong revenue growth. Some companies are willing to postpone profitability to grow revenue faster, but in that case one does expect good top-line growth.
BlackLine grew its revenue by 28% last year. That's a fairly respectable growth rate. Buyers pushed the share price 20% in response, which isn't unreasonable. If the company can maintain the revenue growth, the share price could go higher still. But it's crucial to check profitability and cash flow before forming a view on the future.
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.
Take a more thorough look at BlackLine's financial health with this free report on its balance sheet.
A Different Perspective
It's nice to see that BlackLine shareholders have gained 20% over the last year. We regret to report that the share price is down 2.3% over ninety days. Shorter term share price moves often don't signify much about the business itself. If you would like to research BlackLine in more detail then you might want to take a look at whether insiders have been buying or selling shares in the company.
Of course BlackLine may not be the best stock to buy. So you may wish to see this free collection of growth stocks.
Please note, the market returns quoted in this article reflect the market weighted average returns of stocks that currently trade on US exchanges.
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.
If you spot an error that warrants correction, please contact the editor at email@example.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.