Investors in BJ's Restaurants (NASDAQ:BJRI) have unfortunately lost 21% over the last three years

While not a mind-blowing move, it is good to see that the BJ's Restaurants, Inc. (NASDAQ:BJRI) share price has gained 21% in the last three months. But that doesn't change the fact that the returns over the last three years have been less than pleasing. In fact, the share price is down 21% in the last three years, falling well short of the market return.

Since shareholders are down over the longer term, lets look at the underlying fundamentals over the that time and see if they've been consistent with returns.

See our latest analysis for BJ's Restaurants

BJ's Restaurants 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 expect strong revenue growth. That's because fast revenue growth can be easily extrapolated to forecast profits, often of considerable size.

Over three years, BJ's Restaurants grew revenue at 3.4% per year. That's not a very high growth rate considering it doesn't make profits. The stock dropped 6% during that time. Shareholders will probably be hoping growth picks up soon. But the real upside for shareholders will be if the company can start generating profits.

The company's revenue and earnings (over time) are depicted in the image below (click to see the exact numbers).

earnings-and-revenue-growth

BJ's Restaurants is a well known stock, with plenty of analyst coverage, suggesting some visibility into future growth. So it makes a lot of sense to check out what analysts think BJ's Restaurants will earn in the future (free analyst consensus estimates)

A Different Perspective

While it's certainly disappointing to see that BJ's Restaurants shares lost 0.8% throughout the year, that wasn't as bad as the market loss of 21%. Given the total loss of 0.3% per year over five years, it seems returns have deteriorated in the last twelve months. While some investors do well specializing in buying companies that are struggling (but nonetheless undervalued), don't forget that Buffett said that 'turnarounds seldom turn'. It's always interesting to track share price performance over the longer term. But to understand BJ's Restaurants better, we need to consider many other factors. For example, we've discovered 1 warning sign for BJ's Restaurants that you should be aware of before investing here.

But note: BJ's Restaurants 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 US 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.

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