Allied Esports Entertainment (NASDAQ:AESE) Share Prices Have Dropped 52% In The Last Year

This month, we saw the Allied Esports Entertainment Inc. (NASDAQ:AESE) up an impressive 55%. But that isn't much consolation to those who have suffered through the declines of the last year. Specifically, the stock price slipped by 52% in that time. So the bounce should be viewed in that context. It may be that the fall was an overreaction.

Check out our latest analysis for Allied Esports Entertainment

Because Allied Esports Entertainment 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. When a company doesn't make profits, we'd generally expect 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.

Allied Esports Entertainment's revenue didn't grow at all in the last year. In fact, it fell 8.2%. That looks pretty grim, at a glance. The share price drop of 52% is understandable given the company doesn't have profits to boast of. Having said that, if growth is coming in the future, the stock may have better days ahead. We don't generally like to own companies with falling revenues and no profits, so we're pretty cautious of this one, at the moment.

You can see below how earnings and revenue have changed over time (discover the exact values by clicking on the image).

This free interactive report on Allied Esports Entertainment's balance sheet strength is a great place to start, if you want to investigate the stock further.

A Different Perspective

While Allied Esports Entertainment shareholders are down 52% for the year, the market itself is up 24%. While the aim is to do better than that, it's worth recalling that even great long-term investments sometimes underperform for a year or more. The share price decline has continued throughout the most recent three months, down 0.7%, suggesting an absence of enthusiasm from investors. Given the relatively short history of this stock, we'd remain pretty wary until we see some strong business performance. I find it very interesting to look at share price over the long term as a proxy for business performance. But to truly gain insight, we need to consider other information, too. Like risks, for instance. Every company has them, and we've spotted 5 warning signs for Allied Esports Entertainment (of which 2 shouldn't be ignored!) you should know about.

Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of companies we expect will grow earnings.

Please note, the market returns quoted in this article reflect the market weighted average returns of stocks that currently trade on US exchanges.

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