Net Insurance's(BIT:NET) Share Price Is Down 69% Over The Past Five Years.

Generally speaking long term investing is the way to go. But unfortunately, some companies simply don't succeed. For example the Net Insurance S.p.A. (BIT:NET) share price dropped 69% over five years. We certainly feel for shareholders who bought near the top. The good news is that the stock is up 1.5% in the last week.

View our latest analysis for Net Insurance

To quote Buffett, 'Ships will sail around the world but the Flat Earth Society will flourish. There will continue to be wide discrepancies between price and value in the marketplace...' One flawed but reasonable way to assess how sentiment around a company has changed is to compare the earnings per share (EPS) with the share price.

During five years of share price growth, Net Insurance moved from a loss to profitability. That would generally be considered a positive, so we are surprised to see the share price is down. Other metrics may better explain the share price move.

It could be that the revenue decline of 9.7% per year is viewed as evidence that Net Insurance is shrinking. This has probably encouraged some shareholders to sell down the stock.

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

We know that Net Insurance has improved its bottom line lately, but what does the future have in store? If you are thinking of buying or selling Net Insurance stock, you should check out this free report showing analyst profit forecasts.

A Different Perspective

Net Insurance provided a TSR of 17% over the last twelve months. But that was short of the market average. But at least that's still a gain! Over five years the TSR has been a reduction of 11% per year, over five years. So this might be a sign the business has turned its fortunes around. It's always interesting to track share price performance over the longer term. But to understand Net Insurance better, we need to consider many other factors. Like risks, for instance. Every company has them, and we've spotted 2 warning signs for Net Insurance (of which 1 is a bit unpleasant!) you should know about.

But note: Net Insurance may not be the best stock to buy. So take a peek at this free list of interesting companies with past earnings growth (and further growth forecast).

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