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Did You Manage To Avoid IMPACT Silver's (CVE:IPT) Painful 54% Share Price Drop?

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Simply Wall St
·3 min read
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Investing in stocks inevitably means buying into some companies that perform poorly. Long term IMPACT Silver Corp. (CVE:IPT) shareholders know that all too well, since the share price is down considerably over three years. So they might be feeling emotional about the 54% share price collapse, in that time. Furthermore, it's down 34% in about a quarter. That's not much fun for holders. Of course, this share price action may well have been influenced by the 25% decline in the broader market, throughout the period.

See our latest analysis for IMPACT Silver

IMPACT Silver wasn't profitable in the last twelve months, it is unlikely we'll see a strong correlation between its share price and its earnings per share (EPS). Arguably revenue is our next best option. Shareholders of unprofitable companies usually expect strong revenue growth. As you can imagine, fast revenue growth, when maintained, often leads to fast profit growth.

In the last three years IMPACT Silver saw its revenue shrink by 13% per year. That is not a good result. The share price decline of 23% compound, over three years, is understandable given the company doesn't have profits to boast of, and revenue is moving in the wrong direction. Having said that, if growth is coming in the future, now may be the low ebb for the company. We'd be pretty wary of this one until it makes a profit, because we don't specialize in finding turnaround situations.

The image below shows how earnings and revenue have tracked over time (if you click on the image you can see greater detail).

TSXV:IPT Income Statement March 31st 2020
TSXV:IPT Income Statement March 31st 2020

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

A Different Perspective

It's nice to see that IMPACT Silver shareholders have received a total shareholder return of 5.2% over the last year. Since the one-year TSR is better than the five-year TSR (the latter coming in at 4.9% per year), it would seem that the stock's performance has improved in recent times. 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 IMPACT Silver better, we need to consider many other factors. Case in point: We've spotted 6 warning signs for IMPACT Silver you should be aware of, and 2 of them can't be ignored.

But note: IMPACT Silver may not be the best stock to buy. So take a peek at this free list of interesting companies with past earnings growth (and further growth forecast).

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

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.

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. Thank you for reading.