Shareholders in Tribal Group (LON:TRB) have lost 60%, as stock drops 30% this past week

Investing in stocks comes with the risk that the share price will fall. And unfortunately for Tribal Group plc (LON:TRB) shareholders, the stock is a lot lower today than it was a year ago. To wit the share price is down 60% in that time. To make matters worse, the returns over three years have also been really disappointing (the share price is 38% lower than three years ago). More recently, the share price has dropped a further 34% in a month. This could be related to the recent financial results - you can catch up on the most recent data by reading our company report.

If the past week is anything to go by, investor sentiment for Tribal Group isn't positive, so let's see if there's a mismatch between fundamentals and the share price.

See our latest analysis for Tribal Group

Tribal Group 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. Shareholders of unprofitable companies usually expect strong revenue growth. That's because fast revenue growth can be easily extrapolated to forecast profits, often of considerable size.

In the last twelve months, Tribal Group increased its revenue by 3.0%. While that may seem decent it isn't great considering the company is still making a loss. Without profits, and with revenue growth sluggish, you get a 60% loss for shareholders, over the year. We'd want to see evidence that future revenue growth will be stronger before getting too interested. Of course, the market can be too impatient at times. Why not take a closer look at this one so you're ready to pounce if growth does accelerate.

The graphic below depicts how earnings and revenue have changed over time (unveil the exact values by clicking on the image).

If you are thinking of buying or selling Tribal Group stock, you should check out this FREE detailed report on its balance sheet.

A Different Perspective

We regret to report that Tribal Group shareholders are down 60% for the year (even including dividends). Unfortunately, that's worse than the broader market decline of 2.0%. However, it could simply be that the share price has been impacted by broader market jitters. It might be worth keeping an eye on the fundamentals, in case there's a good opportunity. Unfortunately, last year's performance may indicate unresolved challenges, given that it was worse than the annualised loss of 9% over the last half decade. 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. While it is well worth considering the different impacts that market conditions can have on the share price, there are other factors that are even more important. For example, we've discovered 3 warning signs for Tribal Group that you should be aware of before investing here.

If you like to buy stocks alongside management, then you might just love this free list of companies. (Hint: insiders have been buying them).

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