Datasection (TSE:3905) delivers shareholders massive 109% CAGR over 3 years, surging 10% in the last week alone

For us, stock picking is in large part the hunt for the truly magnificent stocks. But when you hold the right stock for the right time period, the rewards can be truly huge. One such superstar is Datasection Inc. (TSE:3905), which saw its share price soar 809% in three years. It's also good to see the share price up 45% over the last quarter. It really delights us to see such great share price performance for investors.

Since it's been a strong week for Datasection shareholders, let's have a look at trend of the longer term fundamentals.

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Given that Datasection 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. Generally speaking, companies without profits are expected to grow revenue every year, and at a good clip. 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.

In the last 3 years Datasection saw its revenue grow at 21% per year. That's much better than most loss-making companies. And it's not just the revenue that is taking off. The share price is up 109% per year in that time. Despite the strong run, top performers like Datasection have been known to go on winning for decades. So we'd recommend you take a closer look at this one, or even put it on your watchlist.

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

Take a more thorough look at Datasection's financial health with this free report on its balance sheet.

A Different Perspective

It's good to see that Datasection has rewarded shareholders with a total shareholder return of 205% in the last twelve months. That gain is better than the annual TSR over five years, which is 38%. Therefore it seems like sentiment around the company has been positive lately. Someone with an optimistic perspective could view the recent improvement in TSR as indicating that the business itself is getting better with time. 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. Case in point: We've spotted 3 warning signs for Datasection you should be aware of.

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Please note, the market returns quoted in this article reflect the market weighted average returns of stocks that currently trade on Japanese 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.