Passive investing in index funds can generate returns that roughly match the overall market. But you can significantly boost your returns by picking above-average stocks. For example, the Maxeon Solar Technologies, Ltd. (NASDAQ:MAXN) share price is up 43% in the last 1 year, clearly besting the market decline of around 9.6% (not including dividends). So that should have shareholders smiling. Maxeon Solar Technologies hasn't been listed for long, so it's still not clear if it is a long term winner.
The past week has proven to be lucrative for Maxeon Solar Technologies investors, so let's see if fundamentals drove the company's one-year performance.
Maxeon Solar Technologies wasn't profitable in the last twelve months, it is unlikely we'll see a strong correlation between its share price and its earnings per share (EPS). Arguably revenue is our next best option. 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.
Maxeon Solar Technologies grew its revenue by 7.4% last year. That's not a very high growth rate considering it doesn't make profits. The modest growth is probably largely reflected in the share price, which is up 43%. That's not a standout result, but it is solid - much like the level of revenue growth. It could be worth keeping an eye on this one, especially if growth accelerates.
The image below shows how earnings and revenue have tracked over time (if you click on the image you can see greater detail).
If you are thinking of buying or selling Maxeon Solar Technologies stock, you should check out this FREE detailed report on its balance sheet.
A Different Perspective
Maxeon Solar Technologies shareholders should be happy with the total gain of 43% over the last twelve months. A substantial portion of that gain has come in the last three months, with the stock up 104% in that time. Demand for the stock from multiple parties is pushing the price higher; it could be that word is getting out about its virtues as a business. 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 instance, we've identified 2 warning signs for Maxeon Solar Technologies that you should be aware of.
We will like Maxeon Solar 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 US 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.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
