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It's not possible to invest over long periods without making some bad investments. But you want to avoid the really big losses like the plague. So spare a thought for the long term shareholders of AirXpanders, Inc. (ASX:AXP); the share price is down a whopping 97% in the last three years. That would be a disturbing experience. The more recent news is of little comfort, with the share price down 82% in a year.

We really hope anyone holding through that price crash has a diversified portfolio. Even when you lose money, you don't have to lose the lesson.

Check out our latest analysis for AirXpanders

Given that AirXpanders 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 three years, AirXpanders saw its revenue grow by 97% per year, compound. That's well above most other pre-profit companies. So on the face of it we're really surprised to see the share price down 69% a year in the same time period. The share price makes us wonder if there is an issue with profitability. Ultimately, revenue growth doesn't amount to much if the business can't scale well. Unless the balance sheet is strong, the company might have to raise capital.

The graphic below shows how revenue and earnings have changed as management guided the business forward. If you want to see cashflow, you can click on the chart.

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

What about the Total Shareholder Return (TSR)?

We've already covered AirXpanders's share price action, but we should also mention its total shareholder return (TSR). Arguably the TSR is a more complete return calculation because it accounts for the value of dividends (as if they were reinvested), along with the hypothetical value of any discounted capital that have been offered to shareholders. AirXpanders hasn't been paying dividends, but its TSR of -96% exceeds its share price return of -97%, implying it has either spun-off a business, or raised capital at a discount; thereby providing additional value to shareholders.

A Different Perspective

The last twelve months weren't great for AirXpanders shares, which cost holders 78%, while the market was up about 11%. Of course the long term matters more than the short term, and even great stocks will sometimes have a poor year. The three-year loss of 67% per year isn't as bad as the last twelve months, suggesting that the company has not been able to convince the market it has solved its problems. We would be wary of buying into a company with unsolved problems, although some investors will buy into struggling stocks if they believe the price is sufficiently attractive. Before spending more time on AirXpanders it might be wise to click here to see if insiders have been buying or selling shares.