Yahoo Finance Investors Who Bought Victory Square Technologies (CNSX:VST) Shares A Year Ago Are Now Down 82%
The art and science of stock market investing requires a tolerance for losing money on some of the shares you buy. But it’s not unreasonable to try to avoid truly shocking capital losses. We wouldn’t blame Victory Square Technologies Inc. (CNSX:VST) shareholders if they were still in shock after the stock dropped like a lead balloon, down 82% in just one year. A loss like this is a stark reminder that portfolio diversification is important. We wouldn’t rush to judgement on Victory Square Technologies because we don’t have a long term history to look at. Furthermore, it’s down 19% in about a quarter. That’s not much fun for holders.
We really feel for shareholders in this scenario. It’s a good reminder of the importance of diversification, and it’s worth keeping in mind there’s more to life than money, anyway.
See our latest analysis for Victory Square Technologies
Given that Victory Square Technologies only made minimal earnings in the last twelve months, we’ll focus on revenue to gauge its business development. Many high growth companies focus on growing revenue before profits, but if revenue is the focus, it really needs to grow. The main reason for this is that fast revenue growth can be readily extrapolated into a profitable future, but stagnant revenue cannot.
In the last twelve months, Victory Square Technologies increased its revenue by 541%. That’s well above most other pre-profit companies. So the hefty 82% share price crash makes us think the company has somehow offended market participants. Something weird is definitely impacting the stock price; we’d venture the company has destroyed value somehow. What is clear is that the market is not judging the company on its revenue growth right now. Of course, investors do over-react when they are stressed out, so the sell-off could be unjustifiably severe.
Depicted in the graphic below, you’ll see revenue and earnings over time. If you want more detail, you can click on the chart itself.
If you are thinking of buying or selling Victory Square Technologies stock, you should check out this FREE detailed report on its balance sheet.
A Different Perspective
Given that the market gained 3.5% in the last year, Victory Square Technologies shareholders might be miffed that they lost 82%. While the aim is to do better than that, it’s worth recalling that even great long-term investments sometimes underperform for a year or more. With the stock down 19% over the last three months, the market doesn’t seem to believe that the company has solved all its problems. Basically, most investors should be wary of buying into a poor-performing stock, unless the business itself has clearly improved. Before deciding if you like the current share price, check how Victory Square Technologies scores on these 3 valuation metrics.
If you would prefer to check out another company — one with potentially superior financials — then do not miss this free list of companies that have proven they can grow earnings.
Please note, the market returns quoted in this article reflect the market weighted average returns of stocks that currently trade on CA 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.
