Earnings growth of 806% over 1 year hasn't been enough to translate into positive returns for biote (NASDAQ:BTMD) shareholders
The simplest way to benefit from a rising market is to buy an index fund. Active investors aim to buy stocks that vastly outperform the market - but in the process, they risk under-performance. That downside risk was realized by biote Corp. (NASDAQ:BTMD) shareholders over the last year, as the share price declined 45%. That's disappointing when you consider the market declined 12%. biote hasn't been listed for long, so although we're wary of recent listings that perform poorly, it may still prove itself with time. The last month has also been disappointing, with the stock slipping a further 46%.
With the stock having lost 40% in the past week, it's worth taking a look at business performance and seeing if there's any red flags.
See our latest analysis for biote
There is no denying that markets are sometimes efficient, but prices do not always reflect underlying business performance. One flawed but reasonable way to assess how sentiment around a company has changed is to compare the earnings per share (EPS) with the share price.
biote stole the show with its EPS rocketing, in the last year. The rate of growth may not be sustainable, but it is still really positive. As you can imagine, the share price action therefore perturbs us. Some different data might shed some more light on the situation.
biote managed to grow revenue over the last year, which is usually a real positive. Since we can't easily explain the share price movement based on these metrics, it might be worth considering how market sentiment has changed towards the stock.
You can see below how earnings and revenue have changed over time (discover the exact values by clicking on the image).
If you are thinking of buying or selling biote stock, you should check out this FREE detailed report on its balance sheet.
A Different Perspective
biote shareholders are down 45% for the year, even worse than the market loss of 12%. There's no doubt that's a disappointment, but the stock may well have fared better in a stronger market. It's worth noting that the last three months did the real damage, with a 45% decline. This probably signals that the business has recently disappointed shareholders - it will take time to win them back. 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. To that end, you should learn about the 3 warning signs we've spotted with biote (including 1 which is a bit concerning) .
If you like to buy stocks alongside management, then you might just love this free list of companies. (Hint: insiders have been buying them).
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.
