The five-year returns have been massive for Innodata (NASDAQ:INOD) shareholders despite underlying losses increasing
Long term investing can be life changing when you buy and hold the truly great businesses. While the best companies are hard to find, but they can generate massive returns over long periods. For example, the Innodata Inc. (NASDAQ:INOD) share price is up a whopping 411% in the last half decade, a handsome return for long term holders. And this is just one example of the epic gains achieved by some long term investors. It's even up 13% in the last week.
Since it's been a strong week for Innodata shareholders, let's have a look at trend of the longer term fundamentals.
See our latest analysis for Innodata
Innodata wasn't profitable in the last twelve months, 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. That's because it's hard to be confident a company will be sustainable if revenue growth is negligible, and it never makes a profit.
For the last half decade, Innodata can boast revenue growth at a rate of 8.6% per year. That's a pretty good long term growth rate. Arguably it's more than reflected in the very strong share price gain of 39% a year over a half a decade. We usually like strong growth stocks but it does seem the market already appreciates this one quite well!
The graphic below depicts how earnings and revenue have changed over time (unveil the exact values by clicking on the image).
Take a more thorough look at Innodata's financial health with this free report on its balance sheet.
A Different Perspective
We're pleased to report that Innodata shareholders have received a total shareholder return of 193% over one year. That gain is better than the annual TSR over five years, which is 39%. Therefore it seems like sentiment around the company has been positive lately. Given the share price momentum remains strong, it might be worth taking a closer look at the stock, lest you miss an opportunity. It's always interesting to track share price performance over the longer term. But to understand Innodata better, we need to consider many other factors. Case in point: We've spotted 3 warning signs for Innodata you should be aware of, and 1 of them is concerning.
Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of companies we expect will grow earnings.
Please note, the market returns quoted in this article reflect the market weighted average returns of stocks that currently trade on American 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.
