Trulieve Cannabis Corp. (CNSX:TRUL) shareholders should be happy to see the share price up 13% in the last month. But that doesn’t change the fact that the returns over the last year have been less than pleasing. The cold reality is that the stock has dropped 30% in one year, under-performing the market.
View our latest analysis for Trulieve Cannabis
There is no denying that markets are sometimes efficient, but prices do not always reflect underlying business performance. One flawed but reasonable way to assess how sentiment around a company has changed is to compare the earnings per share (EPS) with the share price.
Unfortunately Trulieve Cannabis reported an EPS drop of 96% for the last year. This fall in the EPS is significantly worse than the 30% the share price fall. It may have been that the weak EPS was not as bad as some had feared.
The image below shows how EPS has tracked over time.
It’s good to see that there was some significant insider buying in the last three months. That’s a positive. On the other hand, we think the revenue and earnings trends are much more meaningful measures of the business. Before buying or selling a stock, we always recommend a close examination of historic growth trends, available here..
A Different Perspective
While Trulieve Cannabis shareholders are down 30% for the year, the market itself is up 4.2%. However, keep in mind that even the best stocks will sometimes underperform the market over a twelve month period. With the stock down 6.8% 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. If you want to research this stock further, the data on insider buying is an obvious place to start. You can click here to see who has been buying shares – and the price they paid.
Trulieve Cannabis is not the only stock that insiders are buying. For those who like to find winning investments this free list of growing companies with recent insider purchasing, could be just the ticket.
Please note, the market returns quoted in this article reflect the market weighted average returns of stocks that currently trade on CA exchanges.
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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. Thank you for reading.