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Buying shares in the best businesses can build meaningful wealth for you and your family. And we've seen some truly amazing gains over the years. For example, the Natera, Inc. (NASDAQ:NTRA) share price is up a whopping 353% in the last half decade, a handsome return for long term holders. This just goes to show the value creation that some businesses can achieve. It's also good to see the share price up 21% over the last quarter.
So let's assess the underlying fundamentals over the last 5 years and see if they've moved in lock-step with shareholder returns.
Check out our latest analysis for Natera
Natera isn't currently profitable, so most analysts would look to revenue growth to get an idea of how fast the underlying business is growing. Shareholders of unprofitable companies usually desire strong revenue growth. As you can imagine, fast revenue growth, when maintained, often leads to fast profit growth.
In the last 5 years Natera saw its revenue grow at 32% per year. That's well above most pre-profit companies. Arguably, this is well and truly reflected in the strong share price gain of 35%(per year) over the same period. It's never too late to start following a top notch stock like Natera, since some long term winners go on winning for decades. So we'd recommend you take a closer look at this one, but keep in mind the market seems optimistic.
You can see how earnings and revenue have changed over time in the image below (click on the chart to see the exact values).
Natera is a well known stock, with plenty of analyst coverage, suggesting some visibility into future growth. So it makes a lot of sense to check out what analysts think Natera will earn in the future (free analyst consensus estimates)
A Different Perspective
It's good to see that Natera has rewarded shareholders with a total shareholder return of 156% in the last twelve months. Since the one-year TSR is better than the five-year TSR (the latter coming in at 35% per year), it would seem that the stock's performance has improved in recent times. In the best case scenario, this may hint at some real business momentum, implying that now could be a great time to delve deeper. 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. Consider risks, for instance. Every company has them, and we've spotted 2 warning signs for Natera you should know about.
If you are like me, then you will not want to miss this free list of undervalued small caps that insiders are buying.