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It is a pleasure to report that the SuRo Capital Corp. (NASDAQ:SSSS) is up 36% in the last quarter. Meanwhile over the last three years the stock has dropped hard. Tragically, the share price declined 66% in that time. So it is really good to see an improvement. Perhaps the company has turned over a new leaf.
Although the past week has been more reassuring for shareholders, they're still in the red over the last three years, so let's see if the underlying business has been responsible for the decline.
Check out our latest analysis for SuRo Capital
SuRo Capital isn't currently profitable, so most analysts would look to revenue growth to get an idea of how fast the underlying business is growing. Generally speaking, companies without profits are expected to grow revenue every year, and at a good clip. As you can imagine, fast revenue growth, when maintained, often leads to fast profit growth.
Over three years, SuRo Capital grew revenue at 52% per year. That is faster than most pre-profit companies. In contrast, the share price is down 18% compound, over three years - disappointing by most standards. It seems likely that the market is worried about the continual losses. But a share price drop of that magnitude could well signal that the market is overly negative on the stock.
You can see below how earnings and revenue have changed over time (discover the exact values by clicking on the image).
We like that insiders have been buying shares in the last twelve months. Having said that, most people consider earnings and revenue growth trends to be a more meaningful guide to the business. You can see what analysts are predicting for SuRo Capital in this interactive graph of future profit estimates.
What About The Total Shareholder Return (TSR)?
We'd be remiss not to mention the difference between SuRo Capital's total shareholder return (TSR) and its share price return. The TSR is a return calculation that accounts for the value of cash dividends (assuming that any dividend received was reinvested) and the calculated value of any discounted capital raisings and spin-offs. SuRo Capital's TSR of was a loss of 58% for the 3 years. That wasn't as bad as its share price return, because it has paid dividends.
A Different Perspective
SuRo Capital provided a TSR of 34% over the year. That's fairly close to the broader market return. Most would be happy with a gain, and it helps that the year's return is actually better than the average return over five years, which was 9%. It is possible that management foresight will bring growth well into the future, even if the share price slows down. If you want to research this stock further, the data on insider buying is an obvious place to start. You can click here to see who has been buying shares - and the price they paid.