Yahoo Finance PensionBee Group (LON:PBEE) investors are sitting on a loss of 51% if they invested a year ago
Investing in stocks comes with the risk that the share price will fall. Anyone who held PensionBee Group plc (LON:PBEE) over the last year knows what a loser feels like. The share price has slid 51% in that time. PensionBee Group may have better days ahead, of course; we've only looked at a one year period. Shareholders have had an even rougher run lately, with the share price down 38% in the last 90 days.
It's worthwhile assessing if the company's economics have been moving in lockstep with these underwhelming shareholder returns, or if there is some disparity between the two. So let's do just that.
View our latest analysis for PensionBee Group
PensionBee Group 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. Generally speaking, companies without profits are expected to grow revenue every year, and at a good clip. As you can imagine, fast revenue growth, when maintained, often leads to fast profit growth.
In the last year PensionBee Group saw its revenue grow by 38%. We think that is pretty nice growth. Meanwhile, the share price tanked 51%, suggesting the market had much higher expectations. It may well be that the business remains approximately on track, but its revenue growth has simply been delayed. For us it's important to consider when you think a company will become profitable, if you're basing your valuation on revenue.
The company's revenue and earnings (over time) are depicted in the image below (click to see the exact numbers).
It's probably worth noting that the CEO is paid less than the median at similar sized companies. It's always worth keeping an eye on CEO pay, but a more important question is whether the company will grow earnings throughout the years. So it makes a lot of sense to check out what analysts think PensionBee Group will earn in the future (free profit forecasts).
A Different Perspective
While PensionBee Group shareholders are down 51% for the year, the market itself is up 2.9%. However, keep in mind that even the best stocks will sometimes underperform the market over a twelve month period. With the stock down 38% 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 PensionBee Group better, we need to consider many other factors. Even so, be aware that PensionBee Group is showing 1 warning sign in our investment analysis , you should know about...
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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 British 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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