Reflecting on Perma-Pipe International Holdings' (NASDAQ:PPIH) Share Price Returns Over The Last Year

Perma-Pipe International Holdings, Inc. (NASDAQ:PPIH) shareholders should be happy to see the share price up 13% in the last quarter. But that is minimal compensation for the share price under-performance over the last year. After all, the share price is down 32% in the last year, significantly under-performing the market.

Check out our latest analysis for Perma-Pipe International Holdings

Perma-Pipe International Holdings 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. Shareholders of unprofitable companies usually expect strong revenue growth. 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.

In just one year Perma-Pipe International Holdings saw its revenue fall by 15%. That looks pretty grim, at a glance. Shareholders have seen the share price drop 32% in that time. What would you expect when revenue is falling, and it doesn't make a profit? It's hard to escape the conclusion that buyers must envision either growth down the track, cost cutting, or both.

You can see below how earnings and revenue have changed over time (discover the exact values by clicking on the image).

earnings-and-revenue-growth

This free interactive report on Perma-Pipe International Holdings' balance sheet strength is a great place to start, if you want to investigate the stock further.

A Different Perspective

Investors in Perma-Pipe International Holdings had a tough year, with a total loss of 32%, against a market gain of about 26%. Even the share prices of good stocks drop sometimes, but we want to see improvements in the fundamental metrics of a business, before getting too interested. Longer term investors wouldn't be so upset, since they would have made 0.4%, each year, over five years. It could be that the recent sell-off is an opportunity, so it may be worth checking the fundamental data for signs of a long term growth trend. 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 1 warning sign for Perma-Pipe International Holdings that you should be aware of.

Of course Perma-Pipe International Holdings may not be the best stock to buy. So you may wish to see this free collection of growth stocks.

Please note, the market returns quoted in this article reflect the market weighted average returns of stocks that currently trade on US exchanges.

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. 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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