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Blackboxstocks Inc. (NASDAQ:BLBX) shareholders will doubtless be very grateful to see the share price up 43% in the last quarter. But over the last half decade, the stock has not performed well. In fact, the share price is down 50%, which falls well short of the return you could get by buying an index fund.
Since Blackboxstocks has shed US$24m from its value in the past 7 days, let's see if the longer term decline has been driven by the business' economics.
Blackboxstocks isn't currently profitable, so most analysts would look to revenue growth to get an idea of how fast the underlying business is growing. 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.
In the last half decade, Blackboxstocks saw its revenue increase by 57% per year. That's well above most other pre-profit companies. The share price drop of 8% per year over five years would be considered let down. So you might argue the Blackboxstocks should get more credit for its rather impressive revenue growth over the period. If that's the case, now might be the smart time to take a close look at it.
The graphic below depicts how earnings and revenue have changed over time (unveil the exact values by clicking on the image).
We're pleased to report that the CEO is remunerated more modestly than most CEOs at similarly capitalized companies. It's always worth keeping an eye on CEO pay, but a more important question is whether the company will grow earnings throughout the years. This free interactive report on Blackboxstocks' earnings, revenue and cash flow is a great place to start, if you want to investigate the stock further.
A Different Perspective
Blackboxstocks shareholders gained a total return of 25% during the year. Unfortunately this falls short of the market return. But at least that's still a gain! Over five years the TSR has been a reduction of 8% per year, over five years. It could well be that the business is stabilizing. While it is well worth considering the different impacts that market conditions can have on the share price, there are other factors that are even more important. For instance, we've identified 5 warning signs for Blackboxstocks (3 are concerning) that you should be aware of.
But note: Blackboxstocks may not be the best stock to buy. So take a peek at this free list of interesting companies with past earnings growth (and further growth forecast).
Please note, the market returns quoted in this article reflect the market weighted average returns of stocks that currently trade on US 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.
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