Passive investing in index funds can generate returns that roughly match the overall market. But you can significantly boost your returns by picking above-average stocks. For example, the U.S. Energy Corp. (NASDAQ:USEG) share price is up 81% in the last 1 year, clearly besting the market return of around 24% (not including dividends). So that should have shareholders smiling. Unfortunately the longer term returns are not so good, with the stock falling 46% in the last three years.

The past week has proven to be lucrative for U.S. Energy investors, so let's see if fundamentals drove the company's one-year performance.

See our latest analysis for U.S. Energy

U.S. Energy 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. 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 year U.S. Energy saw its revenue shrink by 33%. The stock is up 81% in that time, a fine performance given the revenue drop. To us that means that there isn't a lot of correlation between the past revenue performance and the share price, but a closer look at analyst forecasts and the bottom line may well explain a lot.

The company's revenue and earnings (over time) are depicted in the image below (click to see the exact numbers).

This free interactive report on U.S. Energy's balance sheet strength is a great place to start, if you want to investigate the stock further.

A Different Perspective

We're pleased to report that U.S. Energy shareholders have received a total shareholder return of 81% over one year. That certainly beats the loss of about 10% per year over the last half decade. This makes us a little wary, but the business might have turned around its fortunes. It's always interesting to track share price performance over the longer term. But to understand U.S. Energy better, we need to consider many other factors. Take risks, for example - U.S. Energy has 4 warning signs we think you should be aware of.

But note: U.S. Energy may not be the best stock to buy. So take a peek at this free list of interesting companies with past earnings growth (and further growth forecast).

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

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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.