Investors might be losing patience for Brighthouse Financial's (NASDAQ:BHF) increasing losses, as stock sheds 4.0% over the past week
If you want to compound wealth in the stock market, you can do so by buying an index fund. But you can significantly boost your returns by picking above-average stocks. To wit, the Brighthouse Financial, Inc. (NASDAQ:BHF) share price is 54% higher than it was a year ago, much better than the market return of around 28% (not including dividends) in the same period. If it can keep that out-performance up over the long term, investors will do very well! And shareholders have also done well over the long term, with an increase of 38% in the last three years.
Although Brighthouse Financial has shed US$174m from its market cap this week, let's take a look at its longer term fundamental trends and see if they've driven returns.
See our latest analysis for Brighthouse Financial
Brighthouse Financial wasn't profitable in the last twelve months, it is unlikely we'll see a strong correlation between its share price and its earnings per share (EPS). Arguably revenue is our next best option. Shareholders of unprofitable companies usually expect strong revenue growth. Some companies are willing to postpone profitability to grow revenue faster, but in that case one does expect good top-line growth.
In the last year Brighthouse Financial saw its revenue shrink by 39%. The stock is up 54% in that time, a fine performance given the revenue drop. We can correlate the share price rise with revenue or profit growth, but it seems the market had previously expected weaker results, and sentiment around the stock is improving.
The image below shows how earnings and revenue have tracked over time (if you click on the image you can see greater detail).
This free interactive report on Brighthouse Financial's balance sheet strength is a great place to start, if you want to investigate the stock further.
A Different Perspective
It's nice to see that Brighthouse Financial shareholders have gained 54% (in total) over the last year. That's better than the annualized TSR of 11% over the last three years. Given the track record of solid returns over varying time frames, it might be worth putting Brighthouse Financial on your watchlist. Shareholders might want to examine this detailed historical graph of past earnings, revenue and cash flow.
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.
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.
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