If you want to compound wealth in the stock market, you can do so by buying an index fund. But you can significantly boost your returns by picking above-average stocks. For example, the mCloud Technologies Corp. (CVE:MCLD) share price is up 33% in the last year, clearly besting the market return of around 4.7% (not including dividends). If it can keep that out-performance up over the long term, investors will do very well! We'll need to follow mCloud Technologies for a while to get a better sense of its share price trend, since it hasn't been listed for particularly long.
Because mCloud Technologies is loss-making, 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. As you can imagine, fast revenue growth, when maintained, often leads to fast profit growth.
In the last year mCloud Technologies saw its revenue grow by 193%. That's well above most other pre-profit companies. While the share price gain of 33% over twelve months is pretty tasty, you might argue it doesn't fully reflect the strong revenue growth. So quite frankly it could be a good time to investigate mCloud Technologies in some detail. Since we evolved from monkeys, we think in linear terms by nature. So if growth goes exponential, opportunity may exist for the enlightened.
The graphic below depicts how earnings and revenue have changed over time (unveil the exact values by clicking on the image).
Balance sheet strength is crucial. It might be well worthwhile taking a look at our free report on how its financial position has changed over time.
A Different Perspective
It's nice to see that mCloud Technologies shareholders have gained 33% over the last year. A substantial portion of that gain has come in the last three months, with the stock up 18% in that time. This suggests the company is continuing to win over new investors. Before spending more time on mCloud Technologies it might be wise to click here to see if insiders have been buying or selling shares.
If you like to buy stocks alongside management, then you might just love this free list of companies. (Hint: insiders have been buying them).
Please note, the market returns quoted in this article reflect the market weighted average returns of stocks that currently trade on CA exchanges.
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.
If you spot an error that warrants correction, please contact the editor at firstname.lastname@example.org. 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. Thank you for reading.