InspireMD's (NASDAQ:NSPR) investors will be pleased with their impressive 179% return over the last year
The most you can lose on any stock (assuming you don't use leverage) is 100% of your money. But when you pick a company that is really flourishing, you can make more than 100%. For example, the InspireMD, Inc. (NASDAQ:NSPR) share price had more than doubled in just one year - up 179%. In the last week the share price is up 2.7%. Zooming out, the stock is actually down 39% in the last three years.
Let's take a look at the underlying fundamentals over the longer term, and see if they've been consistent with shareholders returns.
Check out our latest analysis for InspireMD
InspireMD 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. Shareholders of unprofitable companies usually expect strong revenue growth. That's because fast revenue growth can be easily extrapolated to forecast profits, often of considerable size.
Over the last twelve months, InspireMD's revenue grew by 3.5%. That's not great considering the company is losing money. So we wouldn't have expected the share price to rise by 179%. The business will need a lot more growth to justify that increase. It's quite likely that the market is considering other factors, not just revenue growth.
You can see below how earnings and revenue have changed over time (discover the exact values by clicking on the image).
We consider it positive that insiders have made significant purchases in the last year. Even so, future earnings will be far more important to whether current shareholders make money. This free report showing analyst forecasts should help you form a view on InspireMD
A Different Perspective
It's nice to see that InspireMD shareholders have received a total shareholder return of 179% over the last year. Notably the five-year annualised TSR loss of 15% per year compares very unfavourably with the recent share price performance. The long term loss makes us cautious, but the short term TSR gain certainly hints at a brighter future. It's always interesting to track share price performance over the longer term. But to understand InspireMD better, we need to consider many other factors. Case in point: We've spotted 4 warning signs for InspireMD you should be aware of, and 2 of them can't be ignored.
InspireMD is not the only stock that insiders are buying. For those who like to find winning investments this free list of growing companies with recent insider purchasing, could be just the ticket.
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.
