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Dingdong (Cayman) (NYSE:DDL) shareholders are up 9.2% this past week, but still in the red over the last year

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It is doubtless a positive to see that the Dingdong (Cayman) Limited (NYSE:DDL) share price has gained some 40% in the last three months. But that hardly compensates for the shocking decline over the last twelve months. Specifically, the stock price nose-dived 77% in that time. So the rise may not be much consolation. The important thing is whether the company can turn it around, longer term.

On a more encouraging note the company has added CN¥100m to its market cap in just the last 7 days, so let's see if we can determine what's driven the one-year loss for shareholders.

Check out our latest analysis for Dingdong (Cayman)

Dingdong (Cayman) wasn't profitable in the last twelve months, it is unlikely we'll see a strong correlation between its share price and its earnings per share (EPS). Arguably revenue is our next best option. When a company doesn't make profits, we'd generally expect to see good revenue growth. Some companies are willing to postpone profitability to grow revenue faster, but in that case one does expect good top-line growth.

In the last twelve months, Dingdong (Cayman) increased its revenue by 74%. That's well above most other pre-profit companies. So on the face of it we're really surprised to see the share price down 77% 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.

You can see how earnings and revenue have changed over time in the image below (click on the chart to see the exact values).

earnings-and-revenue-growth
earnings-and-revenue-growth

If you are thinking of buying or selling Dingdong (Cayman) stock, you should check out this FREE detailed report on its balance sheet.

A Different Perspective

We doubt Dingdong (Cayman) shareholders are happy with the loss of 77% over twelve months. That falls short of the market, which lost 19%. That's disappointing, but it's worth keeping in mind that the market-wide selling wouldn't have helped. It's great to see a nice little 40% rebound in the last three months. Let's just hope this isn't the widely-feared 'dead cat bounce' (which would indicate further declines to come). It's always interesting to track share price performance over the longer term. But to understand Dingdong (Cayman) better, we need to consider many other factors. For example, we've discovered 3 warning signs for Dingdong (Cayman) that you should be aware of before investing here.

We will like Dingdong (Cayman) better if we see some big insider buys. While we wait, check out this free list of growing companies with considerable, recent, insider 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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