Shareholders in Fastned B.V (AMS:FAST) have lost 63%, as stock drops 11% this past week

Investing in stocks inevitably means buying into some companies that perform poorly. Long term Fastned B.V. (AMS:FAST) shareholders know that all too well, since the share price is down considerably over three years. Sadly for them, the share price is down 63% in that time. And the ride hasn't got any smoother in recent times over the last year, with the price 31% lower in that time. Furthermore, it's down 21% in about a quarter. That's not much fun for holders.

If the past week is anything to go by, investor sentiment for Fastned B.V isn't positive, so let's see if there's a mismatch between fundamentals and the share price.

View our latest analysis for Fastned B.V

Fastned B.V isn't currently profitable, so most analysts would look to revenue growth to get an idea of how fast the underlying business is growing. When a company doesn't make profits, we'd generally hope to see good 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.

In the last three years, Fastned B.V saw its revenue grow by 71% per year, compound. That's well above most other pre-profit companies. In contrast, the share price is down 18% compound, over three years - disappointing by most standards. It seems likely that the market is worried about the continual losses. When we see revenue growth, paired with a falling share price, we can't help wonder if there is an opportunity for those who are willing to dig deeper.

You can see how earnings and revenue have changed over time in the image below (click on the chart to see the exact values).

We're pleased to report that the CEO is remunerated more modestly than most CEOs at similarly capitalized companies. But while CEO remuneration is always worth checking, the really important question is whether the company can grow earnings going forward. So it makes a lot of sense to check out what analysts think Fastned B.V will earn in the future (free profit forecasts).

A Different Perspective

Investors in Fastned B.V had a tough year, with a total loss of 31%, against a market gain of about 23%. 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 9% over the last half decade. We realise that Baron Rothschild has said investors should "buy when there is blood on the streets", but we caution that investors should first be sure they are buying a high quality business. You might want to assess this data-rich visualization of its earnings, revenue and cash flow.

We will like Fastned B.V 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 Dutch 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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com