Some Crescent (EBR:OPTI) Shareholders Are Down 34%
The simplest way to benefit from a rising market is to buy an index fund. Active investors aim to buy stocks that vastly outperform the market - but in the process, they risk under-performance. That downside risk was realized by Crescent NV (EBR:OPTI) shareholders over the last year, as the share price declined 34%. That's well bellow the market return of 9.9%. We wouldn't rush to judgement on Crescent because we don't have a long term history to look at. Shareholders have had an even rougher run lately, with the share price down 11% in the last 90 days.
View our latest analysis for Crescent
Because Crescent 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. Generally speaking, companies without profits are expected to grow revenue every year, and at a good clip. 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.
Crescent grew its revenue by 20% over the last year. We think that is pretty nice growth. Meanwhile, the share price is down 34% over twelve months, which is disappointing given the progress made. You might even wonder if the share price was previously over-hyped. But if revenue keeps growing, then at a certain point the share price would likely follow.
The image below shows how earnings and revenue have tracked over time (if you click on the image you can see greater detail).
If you are thinking of buying or selling Crescent stock, you should check out this FREE detailed report on its balance sheet.
A Different Perspective
While Crescent shareholders are down 34% for the year, the market itself is up 9.9%. However, keep in mind that even the best stocks will sometimes underperform the market over a twelve month period. With the stock down 11% over the last three months, the market doesn't seem to believe that the company has solved all its problems. Given the relatively short history of this stock, we'd remain pretty wary until we see some strong business performance. It's always interesting to track share price performance over the longer term. But to understand Crescent better, we need to consider many other factors. Be aware that Crescent is showing 5 warning signs in our investment analysis , and 2 of those are significant...
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Please note, the market returns quoted in this article reflect the market weighted average returns of stocks that currently trade on BE exchanges.
If you spot an error that warrants correction, please contact the editor at editorial-team@simplywallst.com. 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. Simply Wall St has no position in the stocks mentioned.
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Thank you for reading.
