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Did You Manage To Avoid Venator Materials's (NYSE:VNTR) 19% Share Price Drop?

Simply Wall St

It is a pleasure to report that the Venator Materials PLC (NYSE:VNTR) is up 34% in the last quarter. But that doesn't change the fact that the returns over the last year have been less than pleasing. In fact the stock is down 19% in the last year, well below the market return.

View our latest analysis for Venator Materials

Given that Venator Materials 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. When a company doesn't make profits, we'd generally expect to see good revenue growth. That's because fast revenue growth can be easily extrapolated to forecast profits, often of considerable size.

In just one year Venator Materials saw its revenue fall by 6.9%. That looks pretty grim, at a glance. The stock price has languished lately, falling 19% in a year. What would you expect when revenue is falling, and it doesn't make a profit? It's hard to escape the conclusion that buyers must envision either growth down the track, cost cutting, or both.

You can see how earnings and revenue have changed over time in the image below (click on the chart to see the exact values).

NYSE:VNTR Income Statement, January 21st 2020

We consider it positive that insiders have made significant purchases in the last year. Having said that, most people consider earnings and revenue growth trends to be a more meaningful guide to the business. So we recommend checking out this free report showing consensus forecasts

A Different Perspective

While Venator Materials shareholders are down 19% for the year, the market itself is up 27%. However, keep in mind that even the best stocks will sometimes underperform the market over a twelve month period. It's great to see a nice little 34% rebound in the last three months. This could just be a bounce because the selling was too aggressive, but fingers crossed it's the start of a new trend. It's always interesting to track share price performance over the longer term. But to understand Venator Materials better, we need to consider many other factors. For instance, we've identified 2 warning signs for Venator Materials that you should be aware of.

Venator Materials 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.

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.