Would Shareholders Who Purchased A.S. Roma's (BIT:ASR) Stock Year Be Happy With The Share price Today?

By
Simply Wall St
Published
December 27, 2020
BIT:ASR
Source: Shutterstock

Taking the occasional loss comes part and parcel with investing on the stock market. And there's no doubt that A.S. Roma S.P.A. (BIT:ASR) stock has had a really bad year. To wit the share price is down 53% in that time. To make matters worse, the returns over three years have also been really disappointing (the share price is 49% lower than three years ago). Even worse, it's down 10% in about a month, which isn't fun at all.

Check out our latest analysis for A.S. Roma

Given that A.S. Roma 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. That's because it's hard to be confident a company will be sustainable if revenue growth is negligible, and it never makes a profit.

A.S. Roma's revenue didn't grow at all in the last year. In fact, it fell 39%. That's not what investors generally want to see. In the absence of profits, it's not unreasonable that the share price fell 53%. Having said that, if growth is coming in the future, the stock may have better days ahead. We don't generally like to own companies with falling revenues and no profits, so we're pretty cautious of this one, at the moment.

The company's revenue and earnings (over time) are depicted in the image below (click to see the exact numbers).

earnings-and-revenue-growth
BIT:ASR Earnings and Revenue Growth December 28th 2020

Take a more thorough look at A.S. Roma's financial health with this free report on its balance sheet.

A Different Perspective

While the broader market lost about 7.8% in the twelve months, A.S. Roma shareholders did even worse, losing 53%. Having said that, it's inevitable that some stocks will be oversold in a falling market. The key is to keep your eyes on the fundamental developments. Regrettably, last year's performance caps off a bad run, with the shareholders facing a total loss of 6% 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 A.S. Roma better, we need to consider many other factors. Even so, be aware that A.S. Roma is showing 3 warning signs in our investment analysis , and 2 of those don't sit too well with us...

But note: A.S. Roma 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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