If You Had Bought Sun Pharma Advanced Research's (NSE:SPARC) Shares Three Years Ago You Would Be Down 57%

The truth is that if you invest for long enough, you're going to end up with some losing stocks. But the last three years have been particularly tough on longer term Sun Pharma Advanced Research Company Limited (NSE:SPARC) shareholders. So they might be feeling emotional about the 57% share price collapse, in that time. The good news is that the stock is up 4.3% in the last week.

See our latest analysis for Sun Pharma Advanced Research

Because Sun Pharma Advanced Research 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. 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.

In the last three years, Sun Pharma Advanced Research saw its revenue grow by 30% per year, compound. That is faster than most pre-profit companies. In contrast, the share price is down 16% compound, over three years - disappointing by most standards. It seems likely that the market is worried about the continual losses. But a share price drop of that magnitude could well signal that the market is overly negative on the stock.

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 Sun Pharma Advanced Research stock, you should check out this FREE detailed report on its balance sheet.

A Different Perspective

Sun Pharma Advanced Research shareholders are down 8.5% for the year, but the market itself is up 23%. 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 5% per year over five years. 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 Sun Pharma Advanced Research better, we need to consider many other factors. Even so, be aware that Sun Pharma Advanced Research is showing 3 warning signs in our investment analysis , you should know about...

We will like Sun Pharma Advanced Research 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 IN 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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