K3 Business Technology Group (LON:KBT) shareholders have endured a 55% loss from investing in the stock five years ago
Generally speaking long term investing is the way to go. But no-one is immune from buying too high. For example the K3 Business Technology Group plc (LON:KBT) share price dropped 56% over five years. That's an unpleasant experience for long term holders. Shareholders have had an even rougher run lately, with the share price down 15% in the last 90 days.
Since shareholders are down over the longer term, lets look at the underlying fundamentals over the that time and see if they've been consistent with returns.
View our latest analysis for K3 Business Technology Group
Because K3 Business Technology Group made a loss in the last twelve months, we think the market is probably more focussed on revenue and revenue growth, at least for now. Shareholders of unprofitable companies usually expect strong revenue growth. As you can imagine, fast revenue growth, when maintained, often leads to fast profit growth.
Over half a decade K3 Business Technology Group reduced its trailing twelve month revenue by 13% for each year. That puts it in an unattractive cohort, to put it mildly. Arguably, the market has responded appropriately to this business performance by sending the share price down 9% (annualized) in the same time period. We don't generally like to own companies that lose money and don't grow revenues. You might be better off spending your money on a leisure activity. This looks like a really risky stock to buy, at a glance.
You can see below how earnings and revenue have changed over time (discover the exact values by clicking on the image).
Take a more thorough look at K3 Business Technology Group's financial health with this free report on its balance sheet.
A Different Perspective
While the broader market gained around 0.6% in the last year, K3 Business Technology Group shareholders lost 9.1%. Even the share prices of good stocks drop sometimes, but we want to see improvements in the fundamental metrics of a business, before getting too interested. However, the loss over the last year isn't as bad as the 9% per annum loss investors have suffered over the last half decade. We'd need to see some sustained improvements in the key metrics before we could muster much enthusiasm. It's always interesting to track share price performance over the longer term. But to understand K3 Business Technology Group better, we need to consider many other factors. For instance, we've identified 2 warning signs for K3 Business Technology Group (1 is significant) that you should be aware of.
If you would prefer to check out another company -- one with potentially superior financials -- then do not miss this free list of companies that have proven they can grow earnings.
Please note, the market returns quoted in this article reflect the market weighted average returns of stocks that currently trade on British 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.
