The past year for Cerberus Cyber Sentinel (NASDAQ:CISO) investors has not been profitable
As every investor would know, you don't hit a homerun every time you swing. But it should be a priority to avoid stomach churning catastrophes, wherever possible. So spare a thought for the long term shareholders of Cerberus Cyber Sentinel Corporation (NASDAQ:CISO); the share price is down a whopping 86% in the last twelve months. A loss like this is a stark reminder that portfolio diversification is important. We wouldn't rush to judgement on Cerberus Cyber Sentinel because we don't have a long term history to look at. While a drop like that is definitely a body blow, money isn't as important as health and happiness.
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.
Check out our latest analysis for Cerberus Cyber Sentinel
Cerberus Cyber Sentinel isn't currently profitable, so most analysts would look to revenue growth to get an idea of how fast the underlying business is growing. Shareholders of unprofitable companies usually expect strong revenue growth. That's because it's hard to be confident a company will be sustainable if revenue growth is negligible, and it never makes a profit.
Cerberus Cyber Sentinel grew its revenue by 218% over the last year. That's a strong result which is better than most other loss making companies. So on the face of it we're really surprised to see the share price down 86% over twelve months. Something weird is definitely impacting the stock price; we'd venture the company has destroyed value somehow. What is clear is that the market is not judging the company on its revenue growth right now. Of course, investors do over-react when they are stressed out, so the sell-off could be unjustifiably severe.
The company's revenue and earnings (over time) are depicted in the image below (click to see the exact numbers).
It's probably worth noting that the CEO is paid less than the median at similar sized companies. But while CEO remuneration is always worth checking, the really important question is whether the company can grow earnings going forward. So it makes a lot of sense to check out what analysts think Cerberus Cyber Sentinel will earn in the future (free profit forecasts).
A Different Perspective
Cerberus Cyber Sentinel shareholders are down 86% for the year, even worse than the market loss of 23%. There's no doubt that's a disappointment, but the stock may well have fared better in a stronger market. With the stock down 9.0% over the last three months, the market doesn't seem to believe that the company has solved all its problems. Basically, most investors should be wary of buying into a poor-performing stock, unless the business itself has clearly improved. It's always interesting to track share price performance over the longer term. But to understand Cerberus Cyber Sentinel better, we need to consider many other factors. Consider risks, for instance. Every company has them, and we've spotted 3 warning signs for Cerberus Cyber Sentinel you should know about.
If you are like me, then you will not want to miss this free list of growing companies that insiders are buying.
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.
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