The most you can lose on any stock (assuming you don't use leverage) is 100% of your money. But if you pick the right stock, you can make a lot more than 100%. For example, the Bloomin' Brands, Inc. (NASDAQ:BLMN) share price has soared 158% return in just a single year. On the other hand, we note it's down 8.4% in about a month. However, the longer term returns haven't been so impressive, with the stock up just 29% in the last three years.
To quote Buffett, 'Ships will sail around the world but the Flat Earth Society will flourish. There will continue to be wide discrepancies between price and value in the marketplace...' One way to examine how market sentiment has changed over time is to look at the interaction between a company's share price and its earnings per share (EPS).
During the last year Bloomin' Brands saw its earnings per share (EPS) drop below zero. While some may see this as temporary, we're a skeptical bunch, and so we're a little surprised to see the share price go up. We might get a clue to explain the share price move by looking to other metrics.
Unfortunately Bloomin' Brands' fell 22% over twelve months. So using a snapshot of key business metrics doesn't give us a good picture of why the market is bidding up the stock.
You can see how earnings and revenue have changed over time in the image below (click on the chart to see the exact values).
Bloomin' Brands is well known by investors, and plenty of clever analysts have tried to predict the future profit levels. You can see what analysts are predicting for Bloomin' Brands in this interactive graph of future profit estimates.
A Different Perspective
It's nice to see that Bloomin' Brands shareholders have received a total shareholder return of 158% over the last year. That's better than the annualised return of 9% over half a decade, implying that the company is doing better recently. In the best case scenario, this may hint at some real business momentum, implying that now could be a great time to delve deeper. It's always interesting to track share price performance over the longer term. But to understand Bloomin' Brands better, we need to consider many other factors. Like risks, for instance. Every company has them, and we've spotted 2 warning signs for Bloomin' Brands (of which 1 is concerning!) you should know about.
We will like Bloomin' Brands better if we see some big insider buys. While we wait, check out this free list of growing companies 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 US 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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