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Shareholders Are Thrilled That The Materialise (NASDAQ:MTLS) Share Price Increased 136%

Simply Wall St

The worst result, after buying shares in a company (assuming no leverage), would be if you lose all the money you put in. But if you buy shares in a really great company, you can more than double your money. For instance the Materialise NV (NASDAQ:MTLS) share price is 136% higher than it was three years ago. How nice for those who held the stock! Unfortunately, though, the stock has dropped 7.8% over a week.

See our latest analysis for Materialise

We don't think that Materialise's modest trailing twelve month profit has the market's full attention at the moment. We think revenue is probably a better guide. Generally speaking, we'd consider a stock like this alongside loss-making companies, simply because the quantum of the profit is so low. It would be hard to believe in a more profitable future without growing revenues.

Materialise's revenue trended up 22% each year over three years. That's much better than most loss-making companies. Along the way, the share price gained 33% per year, a solid pop by our standards. But it does seem like the market is paying attention to strong revenue growth. That's not to say we think the share price is too high. In fact, it might be worth keeping an eye on this one.

You can see how earnings and revenue have changed over time in the image below (click on the chart to see the exact values).

NasdaqGS:MTLS Income Statement, October 21st 2019

It is of course excellent to see how Materialise has grown profits over the years, but the future is more important for shareholders. This free interactive report on Materialise's balance sheet strength is a great place to start, if you want to investigate the stock further.

A Different Perspective

We're pleased to report that Materialise shareholders have received a total shareholder return of 44% over one year. That gain is better than the annual TSR over five years, which is 12%. Therefore it seems like sentiment around the company has been positive lately. Someone with an optimistic perspective could view the recent improvement in TSR as indicating that the business itself is getting better with time. You could get a better understanding of Materialise's growth by checking out this more detailed historical graph of earnings, revenue and cash flow.

Of course Materialise 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 US 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 editorial-team@simplywallst.com. 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.