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A Look At W&T Offshore's (NYSE:WTI) Share Price Returns

Simply Wall St
·3 min read

Investing in stocks comes with the risk that the share price will fall. And unfortunately for W&T Offshore, Inc. (NYSE:WTI) shareholders, the stock is a lot lower today than it was a year ago. The share price is down a hefty 67% in that time. To make matters worse, the returns over three years have also been really disappointing (the share price is 54% lower than three years ago). The falls have accelerated recently, with the share price down 42% in the last three months.

Check out our latest analysis for W&T Offshore

To quote Buffett, 'Ships will sail around the world but the Flat Earth Society will flourish. There will continue to be wide discrepancies between price and value in the marketplace...' By comparing earnings per share (EPS) and share price changes over time, we can get a feel for how investor attitudes to a company have morphed over time.

Unhappily, W&T Offshore had to report a 15% decline in EPS over the last year. The share price decline of 67% is actually more than the EPS drop. This suggests the EPS fall has made some shareholders are more nervous about the business. The P/E ratio of 1.46 also points to the negative market sentiment.

The company's earnings per share (over time) is depicted in the image below (click to see the exact numbers).

earnings-per-share-growth
earnings-per-share-growth

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. Before buying or selling a stock, we always recommend a close examination of historic growth trends, available here..

A Different Perspective

W&T Offshore shareholders are down 67% for the year, but the market itself is up 16%. However, keep in mind that even the best stocks will sometimes underperform the market over a twelve month period. Unfortunately, last year's performance may indicate unresolved challenges, given that it was worse than the annualised loss of 10% over the last half decade. Generally speaking long term share price weakness can be a bad sign, though contrarian investors might want to research the stock in hope of a turnaround. It's always interesting to track share price performance over the longer term. But to understand W&T Offshore better, we need to consider many other factors. Like risks, for instance. Every company has them, and we've spotted 4 warning signs for W&T Offshore (of which 3 don't sit too well with us!) you should know about.

W&T Offshore 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.

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. 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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com.