Yext (NYSE:YEXT shareholders incur further losses as stock declines 6.9% this week, taking five-year losses to 39%
While it may not be enough for some shareholders, we think it is good to see the Yext, Inc. (NYSE:YEXT) share price up 30% in a single quarter. But if you look at the last five years the returns have not been good. In fact, the share price is down 39%, which falls well short of the return you could get by buying an index fund.
If the past week is anything to go by, investor sentiment for Yext isn't positive, so let's see if there's a mismatch between fundamentals and the share price.
View our latest analysis for Yext
Yext 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 fast revenue growth can be easily extrapolated to forecast profits, often of considerable size.
Over five years, Yext grew its revenue at 16% per year. That's well above most other pre-profit companies. Shareholders are no doubt disappointed with the loss of 7%, each year, in that time. So you might argue the Yext should get more credit for its rather impressive revenue growth over the period. If that's the case, now might be the smart time to take a close look at it.
The company's revenue and earnings (over time) are depicted in the image below (click to see the exact numbers).
We're pleased to report that the CEO is remunerated more modestly than most CEOs at similarly capitalized companies. But while CEO remuneration is always worth checking, the really important question is whether the company can grow earnings going forward. So we recommend checking out this free report showing consensus forecasts
A Different Perspective
We're pleased to report that Yext shareholders have received a total shareholder return of 34% over one year. Notably the five-year annualised TSR loss of 7% per year compares very unfavourably with the recent share price performance. The long term loss makes us cautious, but the short term TSR gain certainly hints at a brighter future. I find it very interesting to look at share price over the long term as a proxy for business performance. But to truly gain insight, we need to consider other information, too. Take risks, for example - Yext has 1 warning sign we think you should be aware of.
Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of companies we expect will grow earnings.
Please note, the market returns quoted in this article reflect the market weighted average returns of stocks that currently trade on American 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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