Reflecting on Archer's (OB:ARCH) Share Price Returns Over The Last Three Years

It is a pleasure to report that the Archer Limited (OB:ARCH) is up 89% in the last quarter. But over the last three years we've seen a quite serious decline. In that time, the share price dropped 63%. So it is really good to see an improvement. Perhaps the company has turned over a new leaf.

View our latest analysis for Archer

Given that Archer didn't make a profit in the last twelve months, we'll focus on revenue growth to form a quick view of its business development. Generally speaking, companies without profits are expected to grow revenue every year, and at a good clip. Some companies are willing to postpone profitability to grow revenue faster, but in that case one does expect good top-line growth.

Over the last three years, Archer's revenue dropped 0.6% per year. That's not what investors generally want to see. With revenue in decline, and profit but a dream, we can understand why the share price has been declining at 18% per year. Of course, it's the future that will determine whether today's price is a good one. We'd be pretty wary of this one until it makes a profit, because we don't specialize in finding turnaround situations.

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

This free interactive report on Archer'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 Archer shareholders have received a total shareholder return of 34% over one year. There's no doubt those recent returns are much better than the TSR loss of 1.3% per year over five years. The long term loss makes us cautious, but the short term TSR gain certainly hints at a brighter future. It's always interesting to track share price performance over the longer term. But to understand Archer better, we need to consider many other factors. Consider risks, for instance. Every company has them, and we've spotted 2 warning signs for Archer you should know about.

But note: Archer 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 NO 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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