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While some are satisfied with an index fund, active investors aim to find truly magnificent investments on the stock market. When you find (and hold) a big winner, you can markedly improve your finances. For example, the Cambridge Cognition Holdings Plc (LON:COG) share price is up a whopping 530% in the last year, a handsome return in a single year. It's also good to see the share price up 88% over the last quarter. The company reported its financial results recently; you can catch up on the latest numbers by reading our company report. However, the longer term returns haven't been so impressive, with the stock up just 5.9% in the last three years.
It really delights us to see such great share price performance for investors.
Cambridge Cognition Holdings 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 fast revenue growth can be easily extrapolated to forecast profits, often of considerable size.
Cambridge Cognition Holdings grew its revenue by 34% last year. We respect that sort of growth, no doubt. Arguably it's more than reflected in the truly wondrous share price gain of 530% in the last year. We're always cautious when the share price is up so much, but there's certainly enough revenue growth to justify taking a closer look at Cambridge Cognition Holdings.
You can see how earnings and revenue have changed over time in the image below (click on the chart to see the exact values).
If you are thinking of buying or selling Cambridge Cognition Holdings stock, you should check out this FREE detailed report on its balance sheet.
A Different Perspective
It's nice to see that Cambridge Cognition Holdings shareholders have received a total shareholder return of 530% over the last year. Since the one-year TSR is better than the five-year TSR (the latter coming in at 25% per year), it would seem that the stock's performance has improved in recent times. Given the share price momentum remains strong, it might be worth taking a closer look at the stock, lest you miss an opportunity. 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. Consider for instance, the ever-present spectre of investment risk. We've identified 3 warning signs with Cambridge Cognition Holdings (at least 1 which shouldn't be ignored) , and understanding them should be part of your investment process.
Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of companies we expect will 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.
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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