What are the early trends we should look for to identify a stock that could multiply in value over the long term? Firstly, we'd want to identify a growing return on capital employed (ROCE) and then alongside that, an ever-increasing base of capital employed. If you see this, it typically means it's a company with a great business model and plenty of profitable reinvestment opportunities.

Passive investing in an index fund is a good way to ensure your own returns roughly match the overall market. When you buy individual stocks, you can make higher profits, but you also face the risk of under-performance. Investors in VIZIO Holding Corp. (NYSE:VZIO) have tasted that bitter downside in the last year, as the share price dropped 27%. That falls noticeably short of the market return of around 3.9%. VIZIO Holding may have better days ahead, of course; we've only looked at a one year period. It's down 28% in about a quarter.

Insiders at VIZIO Holding Corp. (NYSE:VZIO) sold US$729k worth of stock at an average price of US$9.12 a share over the past year, making the most of their investment. The company's market valuation decreased by US$103m after the stock price dropped 5.5% over the past week, but insiders were spared from painful losses.

VIZIO Holding is not owned by hedge funds. Looking at our data, we can see that the largest shareholder is the CEO William Wang with 40% of shares outstanding. In comparison, the second and third largest shareholders hold about 7.4% and 5.8% of the stock.

So should VIZIO Holding (NYSE:VZIO) shareholders be worried about its cash burn? In this article, we define cash burn as its annual (negative) free cash flow, which is the amount of money a company spends each year to fund its growth. Let's start with an examination of the business' cash, relative to its cash burn.

This month, we saw the VIZIO Holding Corp. (NYSE:VZIO) up an impressive 52%. But that isn't much consolation to those who have suffered through the declines of the last year. Specifically, the stock price slipped by 51% in that time. So the bounce should be viewed in that context. Arguably, the fall was overdone.