Brookdale Senior Living (NYSE:BKD) shareholders are up 4.0% this past week, but still in the red over the last five years

By
Simply Wall St
Published
April 14, 2022
NYSE:BKD
Source: Shutterstock

It is doubtless a positive to see that the Brookdale Senior Living Inc. (NYSE:BKD) share price has gained some 36% in the last three months. But that doesn't change the fact that the returns over the last five years have been less than pleasing. In fact, the share price is down 45%, which falls well short of the return you could get by buying an index fund.

The recent uptick of 4.0% could be a positive sign of things to come, so let's take a lot at historical fundamentals.

View our latest analysis for Brookdale Senior Living

Brookdale Senior Living isn't currently profitable, so most analysts would look to revenue growth to get an idea of how fast the underlying business is growing. Shareholders of unprofitable companies usually expect strong 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.

Over half a decade Brookdale Senior Living reduced its trailing twelve month revenue by 9.2% for each year. That puts it in an unattractive cohort, to put it mildly. On the face of it we'd posit the share price fall of 8% compound, over five years is well justified by the fundamental deterioration. This loss means the stock shareholders are probably pretty annoyed. It is possible for businesses to bounce back but as Buffett says, 'turnarounds seldom turn'.

The graphic below depicts how earnings and revenue have changed over time (unveil the exact values by clicking on the image).

earnings-and-revenue-growth
NYSE:BKD Earnings and Revenue Growth April 14th 2022

If you are thinking of buying or selling Brookdale Senior Living stock, you should check out this FREE detailed report on its balance sheet.

A Different Perspective

It's good to see that Brookdale Senior Living has rewarded shareholders with a total shareholder return of 6.5% in the last twelve months. There's no doubt those recent returns are much better than the TSR loss of 8% per year over five years. We generally put more weight on the long term performance over the short term, but the recent improvement could hint at a (positive) inflection point within the business. While it is well worth considering the different impacts that market conditions can have on the share price, there are other factors that are even more important. For instance, we've identified 4 warning signs for Brookdale Senior Living (1 shouldn't be ignored) that you should be aware of.

Of course Brookdale Senior Living 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.

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