IDT Australia Limited (ASX:IDT) shareholders should be happy to see the share price up 21% in the last month. But over the last half decade, the stock has not performed well. After all, the share price is down 23% in that time, significantly under-performing the market.
IDT Australia isn't currently profitable, so most analysts would look to revenue growth to get an idea of how fast the underlying business is growing. Generally speaking, companies without profits are expected to grow revenue every year, and at a good clip. That's because fast revenue growth can be easily extrapolated to forecast profits, often of considerable size.
Over five years, IDT Australia grew its revenue at 0.09% per year. That's not a very high growth rate considering it doesn't make profits. Given the weak growth, the share price fall of 5.0% isn't particularly surprising. Investors should consider how bad the losses are, and whether the company can make it to profitability with ease. It could be worth putting it on your watchlist and revisiting when it makes its maiden profit.
You can see how earnings and revenue have changed over time in the image below (click on the chart to see the exact values).
If you are thinking of buying or selling IDT Australia stock, you should check out this FREE detailed report on its balance sheet.
A Different Perspective
IDT Australia provided a TSR of 13% over the year. That's fairly close to the broader market return. To take a positive view, the gain is pleasing, and it sure beats annualized TSR loss of 5.0%, which was endured over half a decade. While 'turnarounds seldom turn' there are green shoots for IDT Australia. You could get a better understanding of IDT Australia's growth by checking out this more detailed historical graph of earnings, revenue and cash flow.
Of course IDT Australia 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 AU exchanges.
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