Investors in APACT (KOSDAQ:200470) from five years ago are still down 41%, even after 14% gain this past week

It's nice to see the APACT Co., Ltd. (KOSDAQ:200470) share price up 14% in a week. But over the last half decade, the stock has not performed well. After all, the share price is down 41% in that time, significantly under-performing the market.

On a more encouraging note the company has added ₩14b to its market cap in just the last 7 days, so let's see if we can determine what's driven the five-year loss for shareholders.

View our latest analysis for APACT

APACT isn't currently profitable, so most analysts would look to revenue growth to get an idea of how fast the underlying business is growing. Generally speaking, companies without profits are expected to grow revenue every year, and at a good clip. As you can imagine, fast revenue growth, when maintained, often leads to fast profit growth.

In the last half decade, APACT saw its revenue increase by 17% per year. That's better than most loss-making companies. The share price drop of 7% per year over five years would be considered let down. You could say that the market has been harsh, given the top line growth. If that's the case, now might be the smart time to take a close look at it.

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

Balance sheet strength is crucial. It might be well worthwhile taking a look at our free report on how its financial position has changed over time.

A Different Perspective

While the broader market lost about 4.0% in the twelve months, APACT shareholders did even worse, losing 26%. 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 7% 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 APACT better, we need to consider many other factors. Even so, be aware that APACT is showing 4 warning signs in our investment analysis , and 2 of those don't sit too well with us...

We will like APACT better if we see some big insider buys. While we wait, check out this free list of undervalued stocks (mostly small caps) 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 South Korean exchanges.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. 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.