Those who invested in Hostelworld Group (LON:HSW) three years ago are up 192%
The most you can lose on any stock (assuming you don't use leverage) is 100% of your money. But when you pick a company that is really flourishing, you can make more than 100%. To wit, the Hostelworld Group plc (LON:HSW) share price has flown 192% in the last three years. How nice for those who held the stock! It's also good to see the share price up 27% over the last quarter.
So let's investigate and see if the longer term performance of the company has been in line with the underlying business' progress.
View our latest analysis for Hostelworld Group
Given that Hostelworld Group didn't make a profit in the last twelve months, we'll focus on revenue growth to form a quick view of its business development. 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.
Hostelworld Group actually saw its revenue drop by 55% per year over three years. So the share price gain of 43% per year is quite surprising. It's fair to say shareholders are definitely counting on a bright future.
The company's revenue and earnings (over time) are depicted in the image below (click to see the exact numbers).
This free interactive report on Hostelworld Group's balance sheet strength is a great place to start, if you want to investigate the stock further.
A Different Perspective
It's nice to see that Hostelworld Group shareholders have received a total shareholder return of 117% over the last year. Notably the five-year annualised TSR loss of 10% per year compares very unfavourably with the recent share price performance. The long term loss makes us cautious, but the short term TSR gain certainly hints at a brighter future. 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. Even so, be aware that Hostelworld Group is showing 1 warning sign in our investment analysis , you should know about...
If you would prefer to check out another company -- one with potentially superior financials -- then do not miss this free list of companies that have proven they can grow earnings.
Please note, the market returns quoted in this article reflect the market weighted average returns of stocks that currently trade on GB exchanges.
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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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