The Nitro Software (ASX:NTO) Share Price Is Up 77% And Shareholders Are Holding On
If you want to compound wealth in the stock market, you can do so by buying an index fund. But if you pick the right individual stocks, you could make more than that. To wit, the Nitro Software Limited (ASX:NTO) share price is 77% higher than it was a year ago, much better than the market return of around 28% (not including dividends) in the same period. If it can keep that out-performance up over the long term, investors will do very well! Nitro Software hasn't been listed for long, so it's still not clear if it is a long term winner.
See our latest analysis for Nitro Software
Because Nitro Software 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. Shareholders of unprofitable companies usually expect strong revenue growth. Some companies are willing to postpone profitability to grow revenue faster, but in that case one does expect good top-line growth.
In the last year Nitro Software saw its revenue grow by 13%. That's not a very high growth rate considering it doesn't make profits. In keeping with the revenue growth, the share price gained 77% in that time. While not a huge gain tht seems pretty reasonable. It could be worth keeping an eye on this one, especially if growth accelerates.
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 Nitro Software stock, you should check out this FREE detailed report on its balance sheet.
A Different Perspective
Nitro Software shareholders should be happy with the total gain of 77% over the last twelve months. The more recent returns haven't been as impressive as the longer term returns, coming in at just 9.0%. It seems likely the market is waiting on fundamental developments with the business before pushing the share price higher (or lower). I find it very interesting to look at share price over the long term as a proxy for business performance. But to truly gain insight, we need to consider other information, too. Take risks, for example - Nitro Software has 3 warning signs (and 1 which is a bit concerning) we think you should know about.
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 AU exchanges.
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. 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.
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