Introducing Neptune Dash Technologies (CVE:DASH), The Stock That Zoomed 200% In The Last Year

Simply Wall St

The most you can lose on any stock (assuming you don't use leverage) is 100% of your money. But when you pick a company that is really flourishing, you can make more than 100%. For example, the Neptune Dash Technologies Corp. (CVE:DASH) share price has soared 200% return in just a single year. On top of that, the share price is up 150% in about a quarter. Neptune Dash Technologies hasn't been listed for long, so it's still not clear if it is a long term winner.

See our latest analysis for Neptune Dash Technologies

We don't think Neptune Dash Technologies's revenue of CA$202,311 is enough to establish significant demand. So it seems shareholders are too busy dreaming about the progress to come than dwelling on the current (lack of) revenue. It seems likely some shareholders believe that Neptune Dash Technologies will significantly advance the business plan before too long.

We think companies that have neither significant revenues nor profits are pretty high risk. There is usually a significant chance that they will need more money for business development, putting them at the mercy of capital markets. So the share price itself impacts the value of the shares (as it determines the cost of capital). While some such companies do very well over the long term, others become hyped up by promoters before eventually falling back down to earth, and going bankrupt (or being recapitalized). Of course, if you time it right, high risk investments like this can really pay off, as Neptune Dash Technologies investors might know.

When it reported in August 2019 Neptune Dash Technologies had minimal cash in excess of all liabilities consider its expenditure: just CA$281k to be specific. So if it hasn't remedied the situation already, it will almost certainly have to raise more capital soon. It's a testament to the popularity of the business plan that the share price gained 73% in the last year , despite the weak balance sheet. You can see in the image below, how Neptune Dash Technologies's cash levels have changed over time (click to see the values). The image below shows how Neptune Dash Technologies's balance sheet has changed over time; if you want to see the precise values, simply click on the image.

TSXV:DASH Historical Debt, January 19th 2020

Of course, the truth is that it is hard to value companies without much revenue or profit. However you can take a look at whether insiders have been buying up shares. It's usually a positive if they have, as it may indicate they see value in the stock. You can click here to see if there are insiders buying.

A Different Perspective

Neptune Dash Technologies shareholders should be happy with the total gain of 200% over the last twelve months. A substantial portion of that gain has come in the last three months, with the stock up 150% in that time. This suggests the company is continuing to win over new investors. 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. Take risks, for example - Neptune Dash Technologies has 7 warning signs (and 4 which are a bit unpleasant) we think you should know about.

Of course Neptune Dash Technologies may not be the best stock to buy. So you may wish to see this free collection of growth stocks.

Please note, the market returns quoted in this article reflect the market weighted average returns of stocks that currently trade on CA exchanges.

If you spot an error that warrants correction, please contact the editor at editorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned.

We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Thank you for reading.