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Bentley Systems (NASDAQ:BSY) shareholders have endured a 18% loss from investing in the stock a year ago

·3 min read

Passive investing in an index fund is a good way to ensure your own returns roughly match the overall market. Active investors aim to buy stocks that vastly outperform the market - but in the process, they risk under-performance. Unfortunately the Bentley Systems, Incorporated (NASDAQ:BSY) share price slid 18% over twelve months. That's well below the market decline of 2.8%. Bentley Systems hasn't been listed for long, so although we're wary of recent listings that perform poorly, it may still prove itself with time. More recently, the share price has dropped a further 8.0% in a month. We do note, however, that the broader market is down 7.5% in that period, and this may have weighed on the share price.

It's worthwhile assessing if the company's economics have been moving in lockstep with these underwhelming shareholder returns, or if there is some disparity between the two. So let's do just that.

View our latest analysis for Bentley Systems

There is no denying that markets are sometimes efficient, but prices do not always reflect underlying business performance. By comparing earnings per share (EPS) and share price changes over time, we can get a feel for how investor attitudes to a company have morphed over time.

Unfortunately Bentley Systems reported an EPS drop of 30% for the last year. This fall in the EPS is significantly worse than the 18% the share price fall. It may have been that the weak EPS was not as bad as some had feared. With a P/E ratio of 138.63, it's fair to say the market sees an EPS rebound on the cards.

The graphic below depicts how EPS has changed over time (unveil the exact values by clicking on the image).

earnings-per-share-growth
earnings-per-share-growth

We consider it positive that insiders have made significant purchases in the last year. Even so, future earnings will be far more important to whether current shareholders make money. It might be well worthwhile taking a look at our free report on Bentley Systems' earnings, revenue and cash flow.

A Different Perspective

We doubt Bentley Systems shareholders are happy with the loss of 18% over twelve months (even including dividends). That falls short of the market, which lost 2.8%. There's no doubt that's a disappointment, but the stock may well have fared better in a stronger market. Putting aside the last twelve months, it's good to see the share price has rebounded by 8.9%, in the last ninety days. Let's just hope this isn't the widely-feared 'dead cat bounce' (which would indicate further declines to come). It's always interesting to track share price performance over the longer term. But to understand Bentley Systems better, we need to consider many other factors. To that end, you should be aware of the 4 warning signs we've spotted with Bentley Systems .

Bentley Systems is not the only stock that insiders are buying. For those who like to find winning investments this free list of growing companies with recent insider purchasing, could be just the ticket.

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