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Agrios Global Holdings Ltd. (CSE:AGRO) shareholders should be happy to see the share price up 13% in the last month. But that doesn't change the fact that the returns over the last year have been stomach churning. To wit, the stock has dropped 76% over the last year. It's not uncommon to see a bounce after a drop like that. The important thing is whether the company can turn it around, longer term.
Agrios Global Holdings isn't currently profitable, so most analysts would look to revenue growth to get an idea of how fast the underlying business is growing. Shareholders of unprofitable companies usually expect strong revenue growth. That's because it's hard to be confident a company will be sustainable if revenue growth is negligible, and it never makes a profit.
Agrios Global Holdings grew its revenue by 70% over the last year. That's a strong result which is better than most other loss making companies. So on the face of it we're really surprised to see the share price down 76% over twelve months. Something weird is definitely impacting the stock price; we'd venture the company has destroyed value somehow. What is clear is that the market is not judging the company on its revenue growth right now. Of course, markets do over-react so share price drop may be too harsh.
The company's revenue and earnings (over time) are depicted in the image below (click to see the exact numbers).
Take a more thorough look at Agrios Global Holdings's financial health with this free report on its balance sheet.
A Different Perspective
Agrios Global Holdings shareholders are down 76% for the year, even worse than the market loss of 8.9%. That's disappointing, but it's worth keeping in mind that the market-wide selling wouldn't have helped. With the stock down 13% over the last three months, the market doesn't seem to believe that the company has solved all its problems. Given the relatively short history of this stock, we'd remain pretty wary until we see some strong business performance. 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. Case in point: We've spotted 5 warning signs for Agrios Global Holdings you should be aware of, and 2 of them are a bit unpleasant.
If you are like me, then you will not want to miss this free list of growing companies that insiders are buying.
Please note, the market returns quoted in this article reflect the market weighted average returns of stocks that currently trade on CA exchanges.
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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. 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. Thank you for reading.