BRP Group (NASDAQ:BRP) dips 6.6% this week as increasing losses might not be inspiring confidence among its investors
It's understandable if you feel frustrated when a stock you own sees a lower share price. But sometimes broader market conditions have more of an impact on prices than the actual business performance. The BRP Group, Inc. (NASDAQ:BRP) share price is down 13% in the last year. But that actually beats the market decline of 20%. BRP Group may have better days ahead, of course; we've only looked at a one year period. And the share price decline continued over the last week, dropping some 6.6%. But this could be related to the soft market, which is down about 9.2% in the same period.
Given the past week has been tough on shareholders, let's investigate the fundamentals and see what we can learn.
Check out our latest analysis for BRP Group
Because BRP Group made a loss in the last twelve months, we think the market is probably more focussed on revenue and revenue growth, at least for now. When a company doesn't make profits, we'd generally expect to see good revenue growth. As you can imagine, fast revenue growth, when maintained, often leads to fast profit growth.
In the last year BRP Group saw its revenue grow by 94%. That's well above most other pre-profit companies. While the share price is down 13% in the last year, not too bad given the weak market. Given the strong revenue growth, it may simply be that the stock is suffering from market conditions. For us, this sort of situation smells of opportunity - the share price is down but the revenue is up. Either way, we'd say the mismatch between the revenue growth and the share price justifies a closer look.
You can see below how earnings and revenue have changed over time (discover the exact values by clicking on the image).
It's good to see that there was some significant insider buying in the last three months. That's a positive. On the other hand, we think the revenue and earnings trends are much more meaningful measures of the business. So we recommend checking out this free report showing consensus forecasts
A Different Perspective
Given that the broader market dropped 20% over the year, the fact that BRP Group shareholders were down 13% isn't so bad. At least the recent returns have been positive, with the stock up 0.08% in around 90 days. The recent uptick could be an early suggestion that the prior falls were too extreme; but we'll need to see how the business progresses. 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 - BRP Group has 4 warning signs (and 1 which is significant) we think you should know about.
BRP Group is not the only stock insiders are buying. So take a peek at this free list of growing companies with insider buying.
Please note, the market returns quoted in this article reflect the market weighted average returns of stocks that currently trade on US 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.
