Revenue Group Berhad's(KLSE:REVENUE) Share Price Is Down 18% Over The Past Year.

Passive investing in an index fund is a good way to ensure your own returns roughly match the overall market. While individual stocks can be big winners, plenty more fail to generate satisfactory returns. Investors in Revenue Group Berhad (KLSE:REVENUE) have tasted that bitter downside in the last year, as the share price dropped 18%. That's well below the market return of 7.6%. Revenue Group Berhad may have better days ahead, of course; we've only looked at a one year period. The silver lining is that the stock is up 1.6% in about a week.

See our latest analysis for Revenue Group Berhad

While markets are a powerful pricing mechanism, share prices reflect investor sentiment, not just underlying business performance. One way to examine how market sentiment has changed over time is to look at the interaction between a company's share price and its earnings per share (EPS).

Unhappily, Revenue Group Berhad had to report a 16% decline in EPS over the last year. We note that the 18% share price drop is very close to the EPS drop. Therefore one could posit that the market has not become more concerned about the company, despite the lower EPS. Instead, the change in the share price seems to reduction in earnings per share, alone.

You can see how EPS has changed over time in the image below (click on the chart to see the exact values).

Before buying or selling a stock, we always recommend a close examination of historic growth trends, available here.

A Different Perspective

Given that the market gained 7.6% in the last year, Revenue Group Berhad shareholders might be miffed that they lost 18%. However, keep in mind that even the best stocks will sometimes underperform the market over a twelve month period. It's great to see a nice little 6.8% rebound in the last three months. Let's just hope this isn't the widely-feared 'dead cat bounce' (which would indicate further declines to come). 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 be aware of the 1 warning sign we've spotted with Revenue Group Berhad .

But note: Revenue Group Berhad 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 MY 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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