Parrot (EPA:PARRO) shareholder returns have been incredible, earning 319% in 1 year

Active investing isn't easy, but for those that do it, the aim is to find the best companies to buy, and to profit handsomely. When you buy and hold the right company, the returns can make a huge difference to both you and your family. For example, Parrot S.A. (EPA:PARRO) has generated a beautiful 319% return in just a single year. On top of that, the share price is up 77% in about a quarter. Looking back further, the stock price is 61% higher than it was three years ago.

Since the stock has added €40m to its market cap in the past week alone, let's see if underlying performance has been driving long-term returns.

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Parrot isn't currently profitable, so most analysts would look to revenue growth to get an idea of how fast the underlying business is growing. Generally speaking, companies without profits are expected to grow revenue every year, and at a good clip. That's because fast revenue growth can be easily extrapolated to forecast profits, often of considerable size.

Parrot grew its revenue by 20% last year. That's a fairly respectable growth rate. Arguably it's more than reflected in the truly wondrous share price gain of 319% in the last year. We're always cautious when the share price is up so much, but there's certainly enough revenue growth to justify taking a closer look at Parrot.

The graphic below depicts how earnings and revenue have changed over time (unveil the exact values by clicking on the image).

If you are thinking of buying or selling Parrot stock, you should check out this FREE detailed report on its balance sheet.

A Different Perspective

It's good to see that Parrot has rewarded shareholders with a total shareholder return of 319% in the last twelve months. That's better than the annualised return of 29% over half a decade, implying that the company is doing better recently. In the best case scenario, this may hint at some real business momentum, implying that now could be a great time to delve deeper. While it is well worth considering the different impacts that market conditions can have on the share price, there are other factors that are even more important. For example, we've discovered 1 warning sign for Parrot that you should be aware of before investing here.

But note: Parrot 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 French 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.