Is Accrol Group Holdings' (LON:ACRL) Share Price Gain Of 188% Well Earned?

The most you can lose on any stock (assuming you don't use leverage) is 100% of your money. But in contrast you can make much more than 100% if the company does well. To wit, the Accrol Group Holdings plc (LON:ACRL) share price has flown 188% in the last three years. Most would be happy with that. In the last week shares have slid back 4.1%.

See our latest analysis for Accrol Group Holdings

We don't think that Accrol Group Holdings' modest trailing twelve month profit has the market's full attention at the moment. We think revenue is probably a better guide. As a general rule, we think this kind of company is more comparable to loss-making stocks, since the actual profit is so low. It would be hard to believe in a more profitable future without growing revenues.

In the last 3 years Accrol Group Holdings saw its revenue shrink by 2.1% per year. So the share price gain of 42% per year is quite surprising. It's a good reminder that expectations about the future, not the past history, always impact share prices.

The image below shows how earnings and revenue have tracked over time (if you click on the image you can see greater detail).

earnings-and-revenue-growth

We consider it positive that insiders have made significant purchases in the last year. Even so, future earnings will be far more important to whether current shareholders make money. This free report showing analyst forecasts should help you form a view on Accrol Group Holdings

A Different Perspective

Pleasingly, Accrol Group Holdings' total shareholder return last year was 87%. That gain actually surpasses the 42% TSR it generated (per year) over three years. Given the track record of solid returns over varying time frames, it might be worth putting Accrol Group Holdings on your watchlist. 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. For example, we've discovered 4 warning signs for Accrol Group Holdings (2 are a bit concerning!) that you should be aware of before investing here.

Accrol Group Holdings is not the only stock insiders are buying. So take a peek at this free list of growing companies with insider buying.

Please note, the market returns quoted in this article reflect the market weighted average returns of stocks that currently trade on GB exchanges.

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. 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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