KAP's (ETR:IUR) Shareholders Are Down 28% On Their Shares

While it may not be enough for some shareholders, we think it is good to see the KAP AG (ETR:IUR) share price up 17% in a single quarter. But in truth the last year hasn't been good for the share price. In fact, the price has declined 28% in a year, falling short of the returns you could get by investing in an index fund.

Check out our latest analysis for KAP

KAP isn't currently profitable, so most analysts would look to revenue growth to get an idea of how fast the underlying business is growing. Generally speaking, companies without profits are expected to grow revenue every year, and at a good clip. 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 KAP saw its revenue fall by 11%. That's not what investors generally want to see. Shareholders have seen the share price drop 28% 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).

Balance sheet strength is crucial. It might be well worthwhile taking a look at our free report on how its financial position has changed over time.

A Different Perspective

Given that the market gained 5.5% in the last year, KAP shareholders might be miffed that they lost 28%. However, keep in mind that even the best stocks will sometimes underperform the market over a twelve month period. Putting aside the last twelve months, it's good to see the share price has rebounded by 17%, in the last ninety days. This could just be a bounce because the selling was too aggressive, but fingers crossed it's the start of a new trend. It's always interesting to track share price performance over the longer term. But to understand KAP better, we need to consider many other factors. Take risks, for example - KAP has 1 warning sign we think you should be aware of.

But note: KAP may not be the best stock to buy. So take a peek at this free list of interesting companies with past earnings growth (and further growth forecast).

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

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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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