0R15 11395.0 -4.4043% 0R1E 9100.0 1.1111% 0M69 None None% 0R2V 237.0 2.5974% 0QYR 1354.0 2.9266% 0QYP 457.0 0.3293% 0RUK None None% 0RYA 1460.0 1.2483% 0RIH 187.8 -0.186% 0RIH 187.4 -0.213% 0R1O 197.0 9862.0733% 0R1O None None% 0QFP None None% 0M2Z 290.35 -0.2405% 0VSO 29.08 -18.3261% 0R1I None None% 0QZI 504.0 -2.0408% 0QZ0 220.0 0.0% 0NZF None None% 0YXG 172.35 -89.9621%

stocks

Life360 (ASX:360) shareholders have earned a 30% CAGR over the last five years - Kalkine

Life360, Inc. (ASX:360) shareholders have seen the share price descend 10% over the month. But that scarcely detracts from the really solid long term returns generated by the company over five years. We think most investors would be happy with the 272% return, over that period. We think it's more important to dwell on the long term returns than the short term returns. The more important question is whether the stock is too cheap or too expensive today.

Now it's worth having a look at the company's fundamentals too, because that will help us determine if the long term shareholder return has matched the performance of the underlying business.

Check out our latest analysis for Life360

Life360 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. When a company doesn't make profits, we'd generally hope to see good revenue growth. That's because it's hard to be confident a company will be sustainable if revenue growth is negligible, and it never makes a profit.

In the last 5 years Life360 saw its revenue grow at 40% per year. That's well above most pre-profit companies. Meanwhile, its share price performance certainly reflects the strong growth, given the share price grew at 30% per year, compound, during the period. So it seems likely that buyers have paid attention to the strong revenue growth. To our minds that makes Life360 worth investigating - it may have its best days ahead.

You can see how earnings and revenue have changed over time in the image below (click on the chart to see the exact values). earnings-and-revenue-growth

If you are thinking of buying or selling Life360 stock, you should check out this FREEdetailed report on its balance sheet.

What About The Total Shareholder Return (TSR)?

We've already covered Life360'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. Life360 hasn't been paying dividends, but its TSR of 275% exceeds its share price return of 272%, implying it has either spun-off a business, or raised capital at a discount; thereby providing additional value to shareholders.

A Different Perspective

We're pleased to report that Life360 shareholders have received a total shareholder return of 101% over one year. Since the one-year TSR is better than the five-year TSR (the latter coming in at 30% per year), it would seem that the stock's performance has improved in recent times. Someone with an optimistic perspective could view the recent improvement in TSR as indicating that the business itself is getting better with time. 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 example, we've discovered 1 warning sign for Life360 that you should be aware of before investing here.



We will like Life360 better if we see some big insider buys. While we wait, check out this freelist of undervalued stocks (mostly small caps) 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 Australian exchanges.

Have feedback on this article? Concerned about the content?Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.

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.

Disclaimer:
This information, including any data, is sourced from Unicorn Data Services SAS, trading as EOD Historical Data (“EODHD”) on ‘as is’ basis, using their API. The information and data provided on this page, as well as via the API, are not guaranteed to be real-time or accurate. In some cases, the data may include analyst ratings or recommendations sourced through the EODHD API, which are intended solely for general informational purposes.
This information does not consider your personal objectives, financial situation, or needs. Kalkine does not assume any responsibility for any trading losses you might incur as a result of using this information, data, or any analyst rating or recommendation provided. Kalkine will not accept any liability for any loss or damage resulting from reliance on the information, including but not limited to data, quotes, charts, analyst ratings, recommendations, and buy/sell signals sourced via the API.
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