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The last three months have been tough on MiMedx Group, Inc. (NASDAQ:MDXG) shareholders, who have seen the share price decline a rather worrying 31%. But in three years the returns have been great. In three years the stock price has launched 224% higher: a great result. To some, the recent share price pullback wouldn't be surprising after such a good run. Only time will tell if there is still too much optimism currently reflected in the share price.
So let's investigate and see if the longer term performance of the company has been in line with the underlying business' progress.
MiMedx Group 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 3 years MiMedx Group saw its revenue shrink by 13% per year. So the share price gain of 48% per year is quite surprising. It's fair to say shareholders are definitely counting on a bright future.
You can see below how earnings and revenue have changed over time (discover the exact values by clicking on the image).
This free interactive report on MiMedx Group's balance sheet strength is a great place to start, if you want to investigate the stock further.
A Different Perspective
MiMedx Group's TSR for the year was broadly in line with the market average, at 32%. To take a positive view, the gain is pleasing, and it sure beats annualized TSR loss of 3%, which was endured over half a decade. While 'turnarounds seldom turn' there are green shoots for MiMedx Group. 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. Even so, be aware that MiMedx Group is showing 3 warning signs in our investment analysis , you should know about...
We will like MiMedx Group better if we see some big insider buys. While we wait, check out this free list of growing companies with considerable, recent, insider buying.
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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