Yahoo Finance Even though Riot Platforms (NASDAQ:RIOT) has lost US$517m market cap in last 7 days, shareholders are still up 121% over 5 years
The last three months have been tough on Riot Platforms, Inc. (NASDAQ:RIOT) shareholders, who have seen the share price decline a rather worrying 36%. But that scarcely detracts from the really solid long term returns generated by the company over five years. We think most investors would be happy with the 121% return, over that period. So while it's never fun to see a share price fall, it's important to look at a longer time horizon. Only time will tell if there is still too much optimism currently reflected in the share price. While the returns over the last 5 years have been good, we do feel sorry for those shareholders who haven't held shares that long, because the share price is down 79% in the last three years.
While the stock has fallen 17% this week, it's worth focusing on the longer term and seeing if the stocks historical returns have been driven by the underlying fundamentals.
Check out our latest analysis for Riot Platforms
Riot Platforms isn't currently profitable, so most analysts would look to revenue growth to get an idea of how fast the underlying business is growing. Shareholders of unprofitable companies usually desire 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.
For the last half decade, Riot Platforms can boast revenue growth at a rate of 57% per year. That's well above most pre-profit companies. Meanwhile, its share price performance certainly reflects the strong growth, given the share price grew at 17% per year, compound, during the period. So it seems likely that buyers have paid attention to the strong revenue growth. To our minds that makes Riot Platforms worth investigating - it may have its best days ahead.
The company's revenue and earnings (over time) are depicted in the image below (click to see the exact numbers).
Riot Platforms is well known by investors, and plenty of clever analysts have tried to predict the future profit levels. So we recommend checking out this free report showing consensus forecasts
A Different Perspective
Riot Platforms shareholders gained a total return of 11% during the year. But that return falls short of the market. If we look back over five years, the returns are even better, coming in at 17% per year for five years. Maybe the share price is just taking a breather while the business executes on its growth strategy. 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. Take risks, for example - Riot Platforms has 3 warning signs (and 1 which is a bit concerning) we think you should know about.
But note: Riot Platforms 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 American 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.
