Sats (OB:SATS investor one-year losses grow to 62% as the stock sheds kr227m this past week
Taking the occasional loss comes part and parcel with investing on the stock market. And unfortunately for Sats ASA (OB:SATS) shareholders, the stock is a lot lower today than it was a year ago. To wit the share price is down 62% in that time. We note that it has not been easy for shareholders over three years, either; the share price is down 39% 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 Sats isn't positive, so let's see if there's a mismatch between fundamentals and the share price.
See our latest analysis for Sats
Because Sats 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. 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 year Sats saw its revenue grow by 26%. That's definitely a respectable growth rate. Meanwhile, the share price tanked 62%, suggesting the market had much higher expectations. It is of course possible that the business will still deliver strong growth, it will just take longer than expected to do it. To our minds it isn't enough to just look at revenue, anyway. Always consider when profits will flow.
The company's revenue and earnings (over time) are depicted in the image below (click to see the exact numbers).
We consider it positive that insiders have made significant purchases in the last year. Even so, future earnings will be far more important to whether current shareholders make money. So it makes a lot of sense to check out what analysts think Sats will earn in the future (free profit forecasts).
A Different Perspective
Sats shareholders are down 62% for the year, falling short of the market return. The market shed around 3.9%, no doubt weighing on the stock price. The three-year loss of 12% per year isn't as bad as the last twelve months, suggesting that the company has not been able to convince the market it has solved its problems. We would be wary of buying into a company with unsolved problems, although some investors will buy into struggling stocks if they believe the price is sufficiently attractive. Investors who like to make money usually check up on insider purchases, such as the price paid, and total amount bought. You can find out about the insider purchases of Sats by clicking this link.
Sats is not the only stock that insiders are buying. For those who like to find winning investments this free list of growing companies with recent insider purchasing, could be just the ticket.
Please note, the market returns quoted in this article reflect the market weighted average returns of stocks that currently trade on Norwegian 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.
Sats ASA provides fitness and training services in Norway, Sweden, Denmark, and Finland.
Undervalued with reasonable growth potential.