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If You Had Bought Metropolitan Bank Holding (NYSE:MCB) Stock A Year Ago, You'd Be Sitting On A 34% Loss, Today

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Simply Wall St
·3 min read
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This week we saw the Metropolitan Bank Holding Corp. (NYSE:MCB) share price climb by 24%. But that doesn't change the fact that the returns over the last year have been less than pleasing. In fact, the price has declined 34% in a year, falling short of the returns you could get by investing in an index fund.

See our latest analysis for Metropolitan Bank Holding

In his essay The Superinvestors of Graham-and-Doddsville Warren Buffett described how share prices do not always rationally reflect the value of a business. One imperfect but simple way to consider how the market perception of a company has shifted is to compare the change in the earnings per share (EPS) with the share price movement.

Even though the Metropolitan Bank Holding share price is down over the year, its EPS actually improved. Of course, the situation might betray previous over-optimism about growth.

It's fair to say that the share price does not seem to be reflecting the EPS growth. So it's well worth checking out some other metrics, too.

Metropolitan Bank Holding's revenue is actually up 30% over the last year. Since the fundamental metrics don't readily explain the share price drop, there might be an opportunity if the market has overreacted.

The image below shows how earnings and revenue have tracked over time (if you click on the image you can see greater detail).

NYSE:MCB Income Statement April 28th 2020
NYSE:MCB Income Statement April 28th 2020

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

Metropolitan Bank Holding shareholders are down 34% for the year, even worse than the market loss of 2.1%. That's disappointing, but it's worth keeping in mind that the market-wide selling wouldn't have helped. Notably, the loss over the last year isn't as bad as the 47% drop in the last three months. So it seems like some holders have been dumping the stock of late - and that's not bullish. 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. For instance, we've identified 1 warning sign for Metropolitan Bank Holding that you should be aware of.

Metropolitan Bank Holding 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.

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.