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Investing in Plexure Group (NZSE:PX1) three years ago would have delivered you a 211% gain

·2 min read

Plexure Group Limited (NZSE:PX1) shareholders might be concerned after seeing the share price drop 21% in the last month. In contrast, the return over three years has been impressive. Indeed, the share price is up a very strong 211% in that time. It's not uncommon to see a share price retrace a bit, after a big gain. If the business can perform well for years to come, then the recent drop could be an opportunity.

Let's take a look at the underlying fundamentals over the longer term, and see if they've been consistent with shareholders returns.

View our latest analysis for Plexure Group

Because Plexure Group made a loss in the last twelve months, we think the market is probably more focussed on revenue and revenue growth, at least for now. 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.

Plexure Group's revenue trended up 31% each year over three years. That's well above most pre-profit companies. Along the way, the share price gained 46% per year, a solid pop by our standards. This suggests the market has recognized the progress the business has made, at least to a significant degree. Nonetheless, we'd say Plexure Group is still worth investigating - successful businesses can often keep growing for long periods.

You can see below how earnings and revenue have changed over time (discover the exact values by clicking on the image).

earnings-and-revenue-growth
earnings-and-revenue-growth

Take a more thorough look at Plexure Group's financial health with this free report on its balance sheet.

A Different Perspective

Investors in Plexure Group had a tough year, with a total loss of 59%, against a market gain of about 12%. However, keep in mind that even the best stocks will sometimes underperform the market over a twelve month period. On the bright side, long term shareholders have made money, with a gain of 17% per year over half a decade. If the fundamental data continues to indicate long term sustainable growth, the current sell-off could be an opportunity worth considering. It's always interesting to track share price performance over the longer term. But to understand Plexure Group better, we need to consider many other factors. Take risks, for example - Plexure Group has 4 warning signs we think you should be aware of.

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 NZ exchanges.

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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.