It might be of some concern to shareholders to see the AmeriTrust Financial Technologies Inc. (CVE:AMT) share price down 23% in the last month. But that cannot eclipse the spectacular share price rise we’ve seen over the last twelve months. Few could complain about the impressive 700% rise, throughout the period. So the recent fall isn’t enough to negate the good performance. Only time will tell if there is still too much optimism currently reflected in the share price. Anyone who held for that rewarding ride would probably be keen to talk about it.
So let’s assess the underlying fundamentals over the last 1 year and see if they’ve moved in lock-step with shareholder returns.
See our latest analysis for AmeriTrust Financial Technologies
Because AmeriTrust Financial Technologies made a loss in the last twelve months, we think the market is probably more focussed on revenue and revenue growth, at least for now. Shareholders of unprofitable companies usually desire strong revenue growth. Some companies are willing to postpone profitability to grow revenue faster, but in that case one would hope for good top-line growth to make up for the lack of earnings.
In the last year AmeriTrust Financial Technologies saw its revenue shrink by 33%. This is in stark contrast to the splendorous stock price, which has rocketed 700% since this time a year ago. There can be no doubt this kind of decoupling of revenue growth and share price growth is unusual to see in loss making companies. To us, a gain like this looks like speculation, but there might be historical trends to back it up.
You can see how earnings and revenue have changed over time in the image below (click on the chart to see the exact values).
It’s good to see that there was some significant insider buying in the last three months. That’s 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 AmeriTrust Financial Technologies’ earnings, revenue and cash flow.
It’s good to see that AmeriTrust Financial Technologies has rewarded shareholders with a total shareholder return of 700% in the last twelve months. That’s better than the annualised return of 15% over half a decade, implying that the company is doing better recently. Given the share price momentum remains strong, it might be worth taking a closer look at the stock, lest you miss an opportunity. 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. Like risks, for instance. Every company has them, and we’ve spotted 6 warning signs for AmeriTrust Financial Technologies (of which 3 are concerning!) you should know about.
