The Rovsing (CPH:ROV) Share Price Is Down 70% So Some Shareholders Are Wishing They Sold
Statistically speaking, long term investing is a profitable endeavour. But no-one is immune from buying too high. To wit, the Rovsing A/S (CPH:ROV) share price managed to fall 70% over five long years. That's an unpleasant experience for long term holders. And some of the more recent buyers are probably worried, too, with the stock falling 41% in the last year. The good news is that the stock is up 1.4% in the last week.
View our latest analysis for Rovsing
Because Rovsing 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. When a company doesn't make profits, we'd generally expect to see good revenue growth. As you can imagine, fast revenue growth, when maintained, often leads to fast profit growth.
Over five years, Rovsing grew its revenue at 4.7% per year. That's not a very high growth rate considering it doesn't make profits. It's likely this weak growth has contributed to an annualised return of 21% for the last five years. We'd want to see proof that future revenue growth is likely to be significantly stronger before getting too interested in Rovsing. However, it's possible too many in the market will ignore it, and there may be an opportunity if it starts to recover down the track.
You can see below how earnings and revenue have changed over time (discover the exact values by clicking on the image).
If you are thinking of buying or selling Rovsing stock, you should check out this FREE detailed report on its balance sheet.
A Different Perspective
Investors in Rovsing had a tough year, with a total loss of 41%, against a market gain of about 32%. 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 21% over the last half decade. We realise that Buffett has said investors should 'buy when there is blood on the streets', but we caution that investors should first be sure they are buying a high quality business. 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. For instance, we've identified 5 warning signs for Rovsing (2 are potentially serious) that you should be aware of.
If you like to buy stocks alongside management, then you might just love this free list of companies. (Hint: insiders have been buying them).
Please note, the market returns quoted in this article reflect the market weighted average returns of stocks that currently trade on DK 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.
