Lesaka Technologies (NASDAQ:LSAK) shareholders have endured a 55% loss from investing in the stock five years ago

While it may not be enough for some shareholders, we think it is good to see the Lesaka Technologies, Inc. (NASDAQ:LSAK) share price up 12% in a single quarter. But that doesn't change the fact that the returns over the last half decade have been disappointing. Indeed, the share price is down 55% in the period. So is the recent increase sufficient to restore confidence in the stock? Not yet. But it could be that the fall was overdone.

With that in mind, it's worth seeing if the company's underlying fundamentals have been the driver of long term performance, or if there are some discrepancies.

View our latest analysis for Lesaka Technologies

Lesaka Technologies 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 it's hard to be confident a company will be sustainable if revenue growth is negligible, and it never makes a profit.

Over half a decade Lesaka Technologies reduced its trailing twelve month revenue by 24% for each year. That puts it in an unattractive cohort, to put it mildly. It seems appropriate, then, that the share price slid about 9% annually during that time. It's fair to say most investors don't like to invest in loss making companies with falling revenue. This looks like a really risky stock to buy, at a glance.

You can see how earnings and revenue have changed over time in the image below (click on the chart to see the exact values).

earnings-and-revenue-growth

This free interactive report on Lesaka Technologies' balance sheet strength is a great place to start, if you want to investigate the stock further.

A Different Perspective

We regret to report that Lesaka Technologies shareholders are down 19% for the year. Unfortunately, that's worse than the broader market decline of 12%. Having said that, it's inevitable that some stocks will be oversold in a falling market. The key is to keep your eyes on the fundamental developments. Regrettably, last year's performance caps off a bad run, with the shareholders facing a total loss of 9% per year over five years. 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. 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. Even so, be aware that Lesaka Technologies is showing 2 warning signs in our investment analysis , you should know about...

We will like Lesaka Technologies better if we see some big insider buys. While we wait, check out this free list of growing companies with considerable, recent, insider buying.

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.

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