Easy Come, Easy Go: How Scomi Energy Services Bhd (KLSE:SCOMIES) Shareholders Got Unlucky And Saw 91% Of Their Cash Evaporate

Long term investing is the way to go, but that doesn't mean you should hold every stock forever. It hits us in the gut when we see fellow investors suffer a loss. For example, we sympathize with anyone who was caught holding Scomi Energy Services Bhd (KLSE:SCOMIES) during the five years that saw its share price drop a whopping 91%.

While a drop like that is definitely a body blow, money isn't as important as health and happiness.

View our latest analysis for Scomi Energy Services Bhd

Scomi Energy Services Bhd 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. 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.

Over half a decade Scomi Energy Services Bhd reduced its trailing twelve month revenue by 27% for each year. That's definitely a weaker result than most pre-profit companies report. So it's not altogether surprising to see the share price down 39% per year in the same time period. This kind of price performance makes us very wary, especially when combined with falling revenue. Of course, the poor performance could mean the market has been too severe selling down. That can happen.

You can see below how earnings and revenue have changed over time (discover the exact values by clicking on the image).

This free interactive report on Scomi Energy Services Bhd's balance sheet strength is a great place to start, if you want to investigate the stock further.

A Different Perspective

We're pleased to report that Scomi Energy Services Bhd shareholders have received a total shareholder return of 10.0% over one year. Notably the five-year annualised TSR loss of 39% per year compares very unfavourably with the recent share price performance. This makes us a little wary, but the business might have turned around its fortunes. While it is well worth considering the different impacts that market conditions can have on the share price, there are other factors that are even more important. To that end, you should learn about the 4 warning signs we've spotted with Scomi Energy Services Bhd (including 1 which is makes us a bit uncomfortable) .

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 MY exchanges.

If you spot an error that warrants correction, please contact the editor at editorial-team@simplywallst.com. 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. Simply Wall St has no position in the stocks mentioned.

We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Thank you for reading.