Yahoo Finance Investing in Family Zone Cyber Safety (ASX:FZO) three years ago would have delivered you a 76% gain
The last three months have been tough on Family Zone Cyber Safety Limited (ASX:FZO) shareholders, who have seen the share price decline a rather worrying 31%. But over three years, the returns would have left most investors smiling In the last three years the share price is up, 76%: better than the market.
Let's take a look at the underlying fundamentals over the longer term, and see if they've been consistent with shareholders returns.
Check out our latest analysis for Family Zone Cyber Safety
Given that Family Zone Cyber Safety 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. Shareholders of unprofitable companies usually expect strong 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 Family Zone Cyber Safety saw its revenue grow at 60% per year. That's well above most pre-profit companies. The share price rise of 21% per year throughout that time is nice to see, and given the revenue growth, that gain seems somewhat justified. If that's the case, now might be the time to take a close look at Family Zone Cyber Safety. A window of opportunity may reveal itself with time, if the business can trend to profitability.
The graphic below depicts how earnings and revenue have changed over time (unveil the exact values by clicking on the image).
We're pleased to report that the CEO is remunerated more modestly than most CEOs at similarly capitalized companies. But while CEO remuneration is always worth checking, the really important question is whether the company can grow earnings going forward. So it makes a lot of sense to check out what analysts think Family Zone Cyber Safety will earn in the future (free profit forecasts).
A Different Perspective
While the broader market lost about 6.6% in the twelve months, Family Zone Cyber Safety shareholders did even worse, losing 43%. However, it could simply be that the share price has been impacted by broader market jitters. It might be worth keeping an eye on the fundamentals, in case there's a good opportunity. Unfortunately, last year's performance may indicate unresolved challenges, given that it was worse than the annualised loss of 2% over the last half decade. Generally speaking long term share price weakness can be a bad sign, though contrarian investors might want to research the stock in hope of a turnaround. 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. Take risks, for example - Family Zone Cyber Safety has 3 warning signs (and 1 which is a bit concerning) we think you should know about.
But note: Family Zone Cyber Safety may not be the best stock to buy. So take a peek at this free list of interesting companies with past earnings growth (and further growth forecast).
Please note, the market returns quoted in this article reflect the market weighted average returns of stocks that currently trade on AU 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.
