Grupo Hotelero Santa Fe. de's (BMV:HOTEL) Stock Price Has Reduced 56% In The Past Three Years

While not a mind-blowing move, it is good to see that the Grupo Hotelero Santa Fe, S.A.B. de C.V. (BMV:HOTEL) share price has gained 19% in the last three months. Meanwhile over the last three years the stock has dropped hard. Regrettably, the share price slid 56% in that period. So it is really good to see an improvement. While many would remain nervous, there could be further gains if the business can put its best foot forward.

See our latest analysis for Grupo Hotelero Santa Fe. de

Because Grupo Hotelero Santa Fe. de 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. 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 three years, Grupo Hotelero Santa Fe. de saw its revenue grow by 3.7% per year, compound. Given it's losing money in pursuit of growth, we are not really impressed with that. This uninspiring revenue growth has no doubt helped send the share price lower; it dropped 16% during the period. When a stock falls hard like this, some investors like to add the company to a watchlist (in case the business recovers, longer term). After all, growing a business isn't easy, and the process will not always be smooth.

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

This free interactive report on Grupo Hotelero Santa Fe. de's balance sheet strength is a great place to start, if you want to investigate the stock further.

A Different Perspective

Investors in Grupo Hotelero Santa Fe. de had a tough year, with a total loss of 27%, against a market gain of about 0.6%. However, keep in mind that even the best stocks will sometimes underperform the market over a twelve month period. Unfortunately, last year's performance may indicate unresolved challenges, given that it was worse than the annualised loss of 8% over the last half decade. 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 Grupo Hotelero Santa Fe. de better, we need to consider many other factors. Case in point: We've spotted 3 warning signs for Grupo Hotelero Santa Fe. de you should be aware of, and 2 of them shouldn't be ignored.

If you would prefer to check out another company -- one with potentially superior financials -- then do not miss this free list of companies that have proven they can grow earnings.

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