If You Had Bought Orient Victory Travel Group's (HKG:265) Shares Five Years Ago You Would Be Down 83%

We're definitely into long term investing, but some companies are simply bad investments over any time frame. We really hate to see fellow investors lose their hard-earned money. For example, we sympathize with anyone who was caught holding Orient Victory Travel Group Company Limited (HKG:265) during the five years that saw its share price drop a whopping 83%. We also note that the stock has performed poorly over the last year, with the share price down 43%. The falls have accelerated recently, with the share price down 43% in the last three months.

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.

Check out our latest analysis for Orient Victory Travel Group

Given that Orient Victory Travel Group 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. Shareholders of unprofitable companies usually expect strong revenue growth. As you can imagine, fast revenue growth, when maintained, often leads to fast profit growth.

In the last half decade, Orient Victory Travel Group saw its revenue increase by 37% per year. That's well above most other pre-profit companies. So it's not at all clear to us why the share price sunk 13% throughout that time. It could be that the stock was over-hyped before. We'd recommend carefully checking for indications of future growth - and balance sheet threats - before considering a purchase.

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

We like that insiders have been buying shares in the last twelve months. Having said that, most people consider earnings and revenue growth trends to be a more meaningful guide to the business. It might be well worthwhile taking a look at our free report on Orient Victory Travel Group's earnings, revenue and cash flow.

A Different Perspective

Investors in Orient Victory Travel Group had a tough year, with a total loss of 43%, against a market gain of about 22%. 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. Unfortunately, last year's performance may indicate unresolved challenges, given that it was worse than the annualised loss of 13% over the last half decade. Generally speaking long term share price weakness can be a bad sign, though contrarian investors might want to research the stock in hope of a turnaround. It's always interesting to track share price performance over the longer term. But to understand Orient Victory Travel Group better, we need to consider many other factors. Even so, be aware that Orient Victory Travel Group is showing 3 warning signs in our investment analysis , and 1 of those is significant...

There are plenty of other companies that have insiders buying up shares. You probably do 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 HK 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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