Shareholders in OVH Groupe (EPA:OVH) have lost 46%, as stock drops 3.1% this past week

Investors can approximate the average market return by buying an index fund. But if you buy individual stocks, you can do both better or worse than that. Unfortunately the OVH Groupe S.A. (EPA:OVH) share price slid 46% over twelve months. That's well below the market return of 23%. Because OVH Groupe hasn't been listed for many years, the market is still learning about how the business performs. The falls have accelerated recently, with the share price down 32% in the last three months.

After losing 3.1% this past week, it's worth investigating the company's fundamentals to see what we can infer from past performance.

Check out our latest analysis for OVH Groupe

SWOT Analysis for OVH Groupe

OVH Groupe 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. Generally speaking, companies without profits are expected to grow revenue every year, and at a good clip. That's because fast revenue growth can be easily extrapolated to forecast profits, often of considerable size.

In the last year OVH Groupe saw its revenue grow by 19%. We think that is pretty nice growth. Unfortunately that wasn't good enough to stop the share price dropping 46%. You might even wonder if the share price was previously over-hyped. However, that's in the past now, and it's the future that matters most.

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

OVH Groupe is a well known stock, with plenty of analyst coverage, suggesting some visibility into future growth. If you are thinking of buying or selling OVH Groupe stock, you should check out this free report showing analyst consensus estimates for future profits.

A Different Perspective

Given that the market gained 23% in the last year, OVH Groupe shareholders might be miffed that they lost 46%. While the aim is to do better than that, it's worth recalling that even great long-term investments sometimes underperform for a year or more. The share price decline has continued throughout the most recent three months, down 32%, suggesting an absence of enthusiasm from investors. Basically, most investors should be wary of buying into a poor-performing stock, unless the business itself has clearly improved. 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. Take risks, for example - OVH Groupe has 2 warning signs (and 1 which is a bit unpleasant) we think you should know about.

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 French 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.