Computer Programs and Systems (NASDAQ:CPSI) shareholders have endured a 67% loss from investing in the stock three years ago
If you love investing in stocks you're bound to buy some losers. Long term Computer Programs and Systems, Inc. (NASDAQ:CPSI) shareholders know that all too well, since the share price is down considerably over three years. So they might be feeling emotional about the 67% share price collapse, in that time. The more recent news is of little comfort, with the share price down 66% in a year. Furthermore, it's down 32% in about a quarter. That's not much fun for holders.
Now let's have a look at the company's fundamentals, and see if the long term shareholder return has matched the performance of the underlying business.
Check out our latest analysis for Computer Programs and Systems
Given that Computer Programs and Systems didn't make a profit in the last twelve months, we'll focus on revenue growth to form a quick view of its business development. Shareholders of unprofitable companies usually expect strong revenue growth. As you can imagine, fast revenue growth, when maintained, often leads to fast profit growth.
In the last three years, Computer Programs and Systems saw its revenue grow by 9.9% per year, compound. That's a fairly respectable growth rate. So some shareholders would be frustrated with the compound loss of 19% per year. The market must have had really high expectations to be disappointed with this progress. It would be well worth taking a closer look at the company, to determine growth trends (and balance sheet strength).
You can see below how earnings and revenue have changed over time (discover the exact values by clicking on the image).
Take a more thorough look at Computer Programs and Systems' financial health with this free report on its balance sheet.
A Different Perspective
Computer Programs and Systems shareholders are down 66% for the year, but the market itself is up 19%. However, keep in mind that even the best stocks will sometimes underperform the market over a twelve month period. Regrettably, last year's performance caps off a bad run, with the shareholders facing a total loss of 10% per year over five years. Generally speaking long term share price weakness can be a bad sign, though contrarian investors might want to research the stock in hope of a turnaround. 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. For instance, we've identified 1 warning sign for Computer Programs and Systems that you should be aware of.
But note: Computer Programs and Systems 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.
