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SailPoint Technologies Holdings (NYSE:SAIL) hikes 22% this week, taking three-year gains to 116%

The worst result, after buying shares in a company (assuming no leverage), would be if you lose all the money you put in. But if you buy shares in a really great company, you can more than double your money. For instance the SailPoint Technologies Holdings, Inc. (NYSE:SAIL) share price is 116% higher than it was three years ago. That sort of return is as solid as granite. Also pleasing for shareholders was the 33% gain in the last three months. This could be related to the recent financial results, released recently - you can catch up on the most recent data by reading our company report.

After a strong gain in the past week, it's worth seeing if longer term returns have been driven by improving fundamentals.

See our latest analysis for SailPoint Technologies Holdings

SailPoint Technologies Holdings wasn't profitable in the last twelve months, it is unlikely we'll see a strong correlation between its share price and its earnings per share (EPS). Arguably revenue is our next best option. 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.

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In the last 3 years SailPoint Technologies Holdings saw its revenue grow at 19% per year. That's a very respectable growth rate. It's fair to say that the market has acknowledged the growth by pushing the share price up 29% per year. The business has made good progress on the top line, but the market is extrapolating the growth. It would be worth thinking about when profits will flow, since that milestone will attract more attention.

You can see below how earnings and revenue have changed over time (discover the exact values by clicking on the image).

earnings-and-revenue-growth
earnings-and-revenue-growth

SailPoint Technologies Holdings is well known by investors, and plenty of clever analysts have tried to predict the future profit levels. You can see what analysts are predicting for SailPoint Technologies Holdings in this interactive graph of future profit estimates.

A Different Perspective

While the market return was 32% in the last year, SailPoint Technologies Holdings returned 34% to shareholders. Most would be happy with a gain, and it helps that the year's return is actually better than the average return of 29% over the last three years, implying that the company is doing better recently. It's good to see the uptick, although the business fundamentals will need to move in the right direction if the company is to sustain the rise. It's always interesting to track share price performance over the longer term. But to understand SailPoint Technologies Holdings better, we need to consider many other factors. Even so, be aware that SailPoint Technologies Holdings is showing 3 warning signs in our investment analysis , you should know about...

If you are like me, then you will not want to miss this free list of growing companies that insiders are buying.

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

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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