BioPorto (CPH:BIOPOR shareholders incur further losses as stock declines 17% this week, taking three-year losses to 71%

As every investor would know, not every swing hits the sweet spot. But really bad investments should be rare. So spare a thought for the long term shareholders of BioPorto A/S (CPH:BIOPOR); the share price is down a whopping 72% in the last three years. That would certainly shake our confidence in the decision to own the stock. And over the last year the share price fell 23%, so we doubt many shareholders are delighted. The falls have accelerated recently, with the share price down 29% in the last three months.

After losing 17% this past week, it's worth investigating the company's fundamentals to see what we can infer from past performance.

See our latest analysis for BioPorto

Given that BioPorto didn't make a profit in the last twelve months, we'll focus on revenue growth to form a quick view of its business development. 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.

Over three years, BioPorto grew revenue at 12% per year. That's a pretty good rate of top-line growth. So it's hard to believe the share price decline of 20% per year is due to the revenue. More likely, the market was spooked by the cost of that revenue. If you buy into companies that lose money then you always risk losing money yourself. Just don't lose the lesson.

The image below shows how earnings and revenue have tracked over time (if you click on the image you can see greater detail).

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. If you are thinking of buying or selling BioPorto stock, you should check out this free report showing analyst profit forecasts.

A Different Perspective

While the broader market gained around 34% in the last year, BioPorto shareholders lost 20%. However, keep in mind that even the best stocks will sometimes underperform the market over a twelve month period. Regrettably, last year's performance caps off a bad run, with the shareholders facing a total loss of 8% per year over five years. We realise that Baron Rothschild has said investors should "buy when there is blood on the streets", but we caution that investors should first be sure they are buying a high quality business. It's always interesting to track share price performance over the longer term. But to understand BioPorto better, we need to consider many other factors. To that end, you should learn about the 6 warning signs we've spotted with BioPorto (including 2 which are concerning) .

If you are like me, then you will not want to miss this free list of growing companies that insiders are buying.

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

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.

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.