Some stocks are best avoided. It hits us in the gut when we see fellow investors suffer a loss. Anyone who held Hudson Global, Inc. (NASDAQ:HSON) for five years would be nursing their metaphorical wounds since the share price dropped 71% in that time. We also note that the stock has performed poorly over the last year, with the share price down 34%. Furthermore, it’s down 31% in about a quarter. That’s not much fun for holders.
Check out our latest analysis for Hudson Global
Given that Hudson Global 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 half a decade Hudson Global reduced its trailing twelve month revenue by 26% for each year. That puts it in an unattractive cohort, to put it mildly. So it’s not that strange that the share price dropped 22% per year in that period. This kind of price performance makes us very wary, especially when combined with falling revenue. Ironically, that behavior could create an opportunity for the contrarian investor – but only if there are good reasons to predict a brighter future.
Take a more thorough look at Hudson Global’s financial health with this free report on its balance sheet.
A Different Perspective
Investors in Hudson Global had a tough year, with a total loss of 34%, against a market gain of about 6.1%. Even the share prices of good stocks drop sometimes, but we want to see improvements in the fundamental metrics of a business, before getting too interested. Regrettably, last year’s performance caps off a bad run, with the shareholders facing a total loss of 21% per year over five years. Generally speaking long term share price weakness can be a bad sign, though contrarian investors might want to research the stock in hope of a turnaround. Before spending more time on Hudson Global it might be wise to click here to see if insiders have been buying or selling shares.
Of course Hudson Global may not be the best stock to buy. So you may wish to see this free collection of growth stocks.
Please note, the market returns quoted in this article reflect the market weighted average returns of stocks that currently trade on US exchanges.
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.
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. Thank you for reading.