If You Had Bought Liquid Media Group (NASDAQ:YVR) Stock A Year Ago, You'd Be Sitting On A 19% Loss, Today
It is a pleasure to report that the Liquid Media Group Ltd. (NASDAQ:YVR) is up 120% in the last quarter. But in truth the last year hasn't been good for the share price. In fact the stock is down 19% in the last year, well below the market return.
See our latest analysis for Liquid Media Group
We don't think Liquid Media Group's revenue of CA$507,103 is enough to establish significant demand. We can't help wondering why it's publicly listed so early in its journey. Are venture capitalists not interested? So it seems shareholders are too busy dreaming about the progress to come than dwelling on the current (lack of) revenue. Investors will be hoping that Liquid Media Group can make progress and gain better traction for the business, before it runs low on cash.
Companies that lack both meaningful revenue and profits are usually considered high risk. You should be aware that there is always a chance that this sort of company will need to issue more shares to raise money to continue pursuing its business plan. While some companies like this go on to deliver on their plan, making good money for shareholders, many end in painful losses and eventual de-listing.
Our data indicates that Liquid Media Group had CA$3.4m more in total liabilities than it had cash, when it last reported in August 2019. That puts it in the highest risk category, according to our analysis. But with the share price diving 19% in the last year , it's probably fair to say that some shareholders no longer believe the company will succeed. You can click on the image below to see (in greater detail) how Liquid Media Group's cash levels have changed over time. The image below shows how Liquid Media Group's balance sheet has changed over time.
In reality it's hard to have much certainty when valuing a business that has neither revenue or profit. Given that situation, would you be concerned if it turned out insiders were relentlessly selling stock? I would feel more nervous about the company if that were so. It only takes a moment for you to check whether we have identified any insider sales recently.
A Different Perspective
While Liquid Media Group shareholders are down 19% for the year, the market itself is up 16%. However, keep in mind that even the best stocks will sometimes underperform the market over a twelve month period. It's great to see a nice little 120% rebound in the last three months. Let's just hope this isn't the widely-feared 'dead cat bounce' (which would indicate further declines to come). Before spending more time on Liquid Media Group it might be wise to click here to see if insiders have been buying or selling shares.
If you like to buy stocks alongside management, then you might just love this free list of companies. (Hint: insiders have been buying them).
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.