Distribuidora Internacional de Alimentación (BME:DIA) shareholders have endured a 84% loss from investing in the stock five years ago

Long term investing works well, but it doesn't always work for each individual stock. It hits us in the gut when we see fellow investors suffer a loss. Anyone who held Distribuidora Internacional de Alimentación, S.A. (BME:DIA) for five years would be nursing their metaphorical wounds since the share price dropped 98% in that time. But it's up 6.5% in the last week. The buoyant market could have helped drive the share price pop, since stocks are up 4.8% in the same period. We really hope anyone holding through that price crash has a diversified portfolio. Even when you lose money, you don't have to lose the lesson.

Since shareholders are down over the longer term, lets look at the underlying fundamentals over the that time and see if they've been consistent with returns.

See our latest analysis for Distribuidora Internacional de Alimentación

Because Distribuidora Internacional de Alimentación made a loss in the last twelve months, we think the market is probably more focussed on revenue and revenue growth, at least for now. Shareholders of unprofitable companies usually desire strong revenue growth. That's because fast revenue growth can be easily extrapolated to forecast profits, often of considerable size.

In the last five years Distribuidora Internacional de Alimentación saw its revenue shrink by 4.5% per year. That's not what investors generally want to see. The share price fall of 15% (per year, over five years) is a stern reminder that money-losing companies are expected to grow revenue. We're generally averse to companies with declining revenues, but we're not alone in that. That is not really what the successful investors we know aim for.

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

Take a more thorough look at Distribuidora Internacional de Alimentación's financial health with this free report on its balance sheet.

What About The Total Shareholder Return (TSR)?

We'd be remiss not to mention the difference between Distribuidora Internacional de Alimentación's total shareholder return (TSR) and its share price return. The TSR is a return calculation that accounts for the value of cash dividends (assuming that any dividend received was reinvested) and the calculated value of any discounted capital raisings and spin-offs. Dividends have been really beneficial for Distribuidora Internacional de Alimentación shareholders, and that cash payout explains why its total shareholder loss of 84%, over the last 5 years, isn't as bad as the share price return.

A Different Perspective

While the broader market gained around 20% in the last year, Distribuidora Internacional de Alimentación shareholders lost 5.0%. 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. However, the loss over the last year isn't as bad as the 13% per annum loss investors have suffered over the last half decade. We would want clear information suggesting the company will grow, before taking the view that the share price will stabilize. It's always interesting to track share price performance over the longer term. But to understand Distribuidora Internacional de Alimentación better, we need to consider many other factors. Take risks, for example - Distribuidora Internacional de Alimentación has 1 warning sign we think you should be aware of.

We will like Distribuidora Internacional de Alimentación better if we see some big insider buys. While we wait, check out this free list of growing companies with considerable, recent, insider buying.

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