Stock Analysis

If You Had Bought GNCO's (KOSDAQ:065060) Shares Three Years Ago You Would Be Down 64%

  •  Updated
KOSDAQ:A065060
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If you love investing in stocks you're bound to buy some losers. But the last three years have been particularly tough on longer term GNCO Co., Ltd. (KOSDAQ:065060) shareholders. Unfortunately, they have held through a 64% decline in the share price in that time. Shareholders have had an even rougher run lately, with the share price down 15% in the last 90 days.

Check out our latest analysis for GNCO

GNCO 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. When a company doesn't make profits, we'd generally expect to see good revenue growth. That's because fast revenue growth can be easily extrapolated to forecast profits, often of considerable size.

Over the last three years, GNCO's revenue dropped 0.8% per year. That's not what investors generally want to see. With revenue in decline, and profit but a dream, we can understand why the share price has been declining at 18% per year. Having said that, if growth is coming in the future, now may be the low ebb for the company. We'd be pretty wary of this one until it makes a profit, because we don't specialize in finding turnaround situations.

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

earnings-and-revenue-growth
KOSDAQ:A065060 Earnings and Revenue Growth January 12th 2021

You can see how its balance sheet has strengthened (or weakened) over time in this free interactive graphic.

A Different Perspective

While the broader market gained around 45% in the last year, GNCO shareholders lost 20%. 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. 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 GNCO better, we need to consider many other factors. Even so, be aware that GNCO is showing 2 warning signs in our investment analysis , and 1 of those is a bit unpleasant...

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

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About KOSDAQ:A065060

GNCO

GNCO Co., Ltd. designs, manufactures, and sells apparel for men and women in South Korea and internationally.

Slightly overvalued with worrying balance sheet.

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