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If You Had Bought Bigtincan Holdings (ASX:BTH) Stock A Year Ago, You Could Pocket A 121% Gain Today

Simply Wall St

Unfortunately, investing is risky - companies can and do go bankrupt. But if you pick the right stock, you can make a lot more than 100%. For example, the Bigtincan Holdings Limited (ASX:BTH) share price has soared 121% in the last year. Most would be very happy with that, especially in just one year! It's also good to see the share price up 15% over the last quarter. Bigtincan Holdings hasn't been listed for long, so it's still not clear if it is a long term winner.

View our latest analysis for Bigtincan Holdings

Bigtincan Holdings 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. 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.

Over the last twelve months, Bigtincan Holdings's revenue grew by 51%. That's stonking growth even when compared to other loss-making stocks. Meanwhile, the market has paid attention, sending the share price soaring 121% in response. That sort of revenue growth is bound to attract attention, even if the company doesn't turn a profit. Given the positive sentiment around the stock we're cautious, but there's no doubt its worth watching.

The image below shows how earnings and revenue have tracked over time (if you click on the image you can see greater detail).

ASX:BTH Income Statement, December 19th 2019
ASX:BTH Income Statement, December 19th 2019

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

What about the Total Shareholder Return (TSR)?

We've already covered Bigtincan Holdings's share price action, but we should also mention its total shareholder return (TSR). Arguably the TSR is a more complete return calculation because it accounts for the value of dividends (as if they were reinvested), along with the hypothetical value of any discounted capital that have been offered to shareholders. We note that Bigtincan Holdings's TSR, at 124% is higher than its share price return of 121%. When you consider it hasn't been paying a dividend, this data suggests shareholders have benefitted from a spin-off, or had the opportunity to acquire attractively priced shares in a discounted capital raising.

A Different Perspective

Bigtincan Holdings shareholders should be happy with the total gain of 124% over the last twelve months. That's better than the more recent three month gain of 15%, implying that share price has plateaued recently. Having said that, we doubt shareholders would be concerned. It seems the market is simply waiting on more information, because if the business delivers so will the share price (eventually). Most investors take the time to check the data on insider transactions. You can click here to see if insiders have been buying or selling.

But note: Bigtincan Holdings may not be the best stock to buy. So take a peek at this free list of interesting companies with past earnings growth (and further growth forecast).

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

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. Thank you for reading.