Some Amplitude Surgical (EPA:AMPLI) Shareholders Have Taken A Painful 74% Share Price Drop
Every investor on earth makes bad calls sometimes. But really big losses can really drag down an overall portfolio. So spare a thought for the long term shareholders of Amplitude Surgical SA (EPA:AMPLI); the share price is down a whopping 74% in the last three years. That might cause some serious doubts about the merits of the initial decision to buy the stock, to put it mildly. And over the last year the share price fell 61%, so we doubt many shareholders are delighted. The falls have accelerated recently, with the share price down 40% in the last three months. However, one could argue that the price has been influenced by the general market, which is down 24% in the same timeframe.
Check out our latest analysis for Amplitude Surgical
In his essay The Superinvestors of Graham-and-Doddsville Warren Buffett described how share prices do not always rationally reflect the value of a business. One way to examine how market sentiment has changed over time is to look at the interaction between a company's share price and its earnings per share (EPS).
Amplitude Surgical became profitable within the last five years. We would usually expect to see the share price rise as a result. So given the share price is down it's worth checking some other metrics too.
Revenue is actually up 5.5% over the three years, so the share price drop doesn't seem to hinge on revenue, either. It's probably worth investigating Amplitude Surgical further; while we may be missing something on this analysis, there might also be an opportunity.
The graphic below depicts how earnings and revenue have changed over time (unveil the exact values by clicking on the image).
We know that Amplitude Surgical has improved its bottom line lately, but what does the future have in store? This free report showing analyst forecasts should help you form a view on Amplitude Surgical
A Different Perspective
Amplitude Surgical shareholders are down 61% for the year, falling short of the market return. Meanwhile, the broader market slid about 14%, likely weighing on the stock. The three-year loss of 36% per year isn't as bad as the last twelve months, suggesting that the company has not been able to convince the market it has solved its problems. We would be wary of buying into a company with unsolved problems, although some investors will buy into struggling stocks if they believe the price is sufficiently attractive. 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. Even so, be aware that Amplitude Surgical is showing 5 warning signs in our investment analysis , and 2 of those don't sit too well with us...
If you would prefer to check out another company -- one with potentially superior financials -- then do not miss this free list of companies that have proven they can grow earnings.
Please note, the market returns quoted in this article reflect the market weighted average returns of stocks that currently trade on FR 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.
