Would Shareholders Who Purchased Dun & Bradstreet Holdings' (NYSE:DNB) Stock Year Be Happy With The Share price Today?
Passive investing in an index fund is a good way to ensure your own returns roughly match the overall market. While individual stocks can be big winners, plenty more fail to generate satisfactory returns. That downside risk was realized by Dun & Bradstreet Holdings, Inc. (NYSE:DNB) shareholders over the last year, as the share price declined 16%. That's disappointing when you consider the market returned 44%. Dun & Bradstreet Holdings hasn't been listed for long, so although we're wary of recent listings that perform poorly, it may still prove itself with time. Unhappily, the share price slid 2.7% in the last week.
See our latest analysis for Dun & Bradstreet Holdings
Dun & Bradstreet Holdings isn't currently profitable, so most analysts would look to revenue growth to get an idea of how fast the underlying business is growing. When a company doesn't make profits, we'd generally expect to see good 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.
Dun & Bradstreet Holdings grew its revenue by 13% over the last year. That's not a very high growth rate considering it doesn't make profits. Given this fairly low revenue growth (and lack of profits), it's not particularly surprising to see the stock down 16% in a year. It's important not to lose sight of the fact that profitless companies must grow. But if you buy a loss making company then you could become a loss making investor.
The image below shows how earnings and revenue have tracked over time (if you click on the image you can see greater detail).
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. If you are thinking of buying or selling Dun & Bradstreet Holdings stock, you should check out this free report showing analyst profit forecasts.
A Different Perspective
While Dun & Bradstreet Holdings shareholders are down 16% for the year, the market itself is up 44%. However, keep in mind that even the best stocks will sometimes underperform the market over a twelve month period. The share price decline has continued throughout the most recent three months, down 8.8%, suggesting an absence of enthusiasm from investors. Given the relatively short history of this stock, we'd remain pretty wary until we see some strong business performance. 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. Consider risks, for instance. Every company has them, and we've spotted 1 warning sign for Dun & Bradstreet Holdings you should know about.
There are plenty of other companies that have insiders buying up shares. You probably do 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.
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.
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