IDT Australia Limited (ASX:IDT) shareholders will doubtless be very grateful to see the share price up 55% in the last month. But over the last half decade, the stock has not performed well. After all, the share price is down 40% in that time, significantly under-performing the market.
See our latest analysis for IDT Australia
Given that IDT Australia 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. Some companies are willing to postpone profitability to grow revenue faster, but in that case one does expect good top-line growth.
In the last half decade, IDT Australia saw its revenue increase by 1.8% per year. That’s far from impressive given all the money it is losing. Given the weak growth, the share price fall of 9.8% isn’t particularly surprising. The key question is whether the company can make it to profitability, and beyond, without trouble. It could be worth putting it on your watchlist and revisiting when it makes its maiden profit.
The company’s revenue and earnings (over time) are depicted in the image below (click to see the exact numbers).
It’s probably worth noting we’ve seen significant insider buying in the last quarter, which we consider a positive. That said, we think earnings and revenue growth trends are even more important factors to consider. Dive deeper into the earnings by checking this interactive graph of IDT Australia’s earnings, revenue and cash flow.
A Different Perspective
While it’s certainly disappointing to see that IDT Australia shares lost 3.1% throughout the year, that wasn’t as bad as the market loss of 11%. What is more upsetting is the 9.8% per annum loss investors have suffered over the last half decade. While the losses are slowing we doubt many shareholders are happy with the stock. It’s always interesting to track share price performance over the longer term. But to understand IDT Australia better, we need to consider many other factors. For example, we’ve discovered 4 warning signs for IDT Australia (1 is a bit concerning!) that you should be aware of before investing here.
IDT Australia is not the only stock that insiders are buying. For those who like to find winning investments this free list of growing companies with recent insider purchasing, could be just the ticket.
Please note, the market returns quoted in this article reflect the market weighted average returns of stocks that currently trade on AU exchanges.
If you spot an error that warrants correction, please contact the editor at [email protected] This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned.
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