Yahoo Finance Investors Who Bought Clearford Water Systems (CVE:CLI) Shares Five Years Ago Are Now Down 94%
Long term investing is the way to go, but that doesn't mean you should hold every stock forever. We really hate to see fellow investors lose their hard-earned money. For example, we sympathize with anyone who was caught holding Clearford Water Systems Inc. (CVE:CLI) during the five years that saw its share price drop a whopping 94%. We also note that the stock has performed poorly over the last year, with the share price down 33%. The good news is that the stock is up 33% in the last week.
While a drop like that is definitely a body blow, money isn't as important as health and happiness.
See our latest analysis for Clearford Water Systems
Given that Clearford Water Systems didn't make a profit in the last twelve months, we'll focus on revenue growth to form a quick view of its business development. Generally speaking, companies without profits are expected to grow revenue every year, and at a good clip. That's because fast revenue growth can be easily extrapolated to forecast profits, often of considerable size.
Over five years, Clearford Water Systems grew its revenue at 34% per year. That's better than most loss-making companies. So it's not at all clear to us why the share price sunk 42% throughout that time. It could be that the stock was over-hyped before. We'd recommend carefully checking for indications of future growth - and balance sheet threats - before considering a purchase.
You can see how earnings and revenue have changed over time in the image below (click on the chart to see the exact values).
Take a more thorough look at Clearford Water Systems's financial health with this free report on its balance sheet.
A Different Perspective
While the broader market gained around 11% in the last year, Clearford Water Systems shareholders lost 33%. However, keep in mind that even the best stocks will sometimes underperform the market over a twelve month period. However, the loss over the last year isn't as bad as the 42% per annum loss investors have suffered over the last half decade. We would want clear information suggesting the company will grow, before taking the view that the share price will stabilize. 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. Case in point: We've spotted 5 warning signs for Clearford Water Systems you should be aware of, and 3 of them are concerning.
For those who like to find winning investments this free list of growing companies with recent insider purchasing, could be just the ticket.
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.
