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We think that it's fair to say that the possibility of finding fantastic multi-year winners is what motivates many investors. But when you hold the right stock for the right time period, the rewards can be truly huge. Take, for example, the Lloyd Fonds AG (ETR:L1OA) share price, which skyrocketed 307% over three years. It's also good to see the share price up 19% over the last quarter. But this move may well have been assisted by the reasonably buoyant market (up 7.8% in 90 days).
See our latest analysis for Lloyd Fonds
Because Lloyd Fonds is loss-making, we think the market is probably more focussed on revenue and revenue growth, at least for now. Generally speaking, companies without profits are expected to grow revenue every year, and at a good clip. 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 3 years Lloyd Fonds saw its revenue shrink by 20% per year. So it's pretty amazing to see the stock price has zoomed up 60% per year in that time. This clear lack of correlation between revenue and share price is surprising to see in a money losing company. At the risk of upsetting holders, this does suggest that hope for a better future is playing a significant role in the share price action.
Depicted in the graphic below, you'll see revenue and earnings over time. If you want more detail, you can click on the chart itself.
Take a more thorough look at Lloyd Fonds's financial health with this free report on its balance sheet.
A Dividend Lost
The value of past dividends are accounted for in the total shareholder return (TSR), but not in the share price return mentioned above. In some ways, TSR is a better measure of how well an investment has performed. Lloyd Fonds's TSR over the last 3 years is 336%; better than its share price return. Even though the company isn't paying dividends at the moment, it has done in the past.
A Different Perspective
We're pleased to report that Lloyd Fonds shareholders have received a total shareholder return of 42% over one year. Since the one-year TSR is better than the five-year TSR (the latter coming in at 34% per year), it would seem that the stock's performance has improved in recent times. 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 Lloyd Fonds's growth by checking out this more detailed historical graph of earnings, revenue and cash flow.