Yahoo Finance Shareholders in Dada Nexus (NASDAQ:DADA) have lost 24%, as stock drops 7.3% this past week
The simplest way to benefit from a rising market is to buy an index fund. But if you buy individual stocks, you can do both better or worse than that. Unfortunately the Dada Nexus Limited (NASDAQ:DADA) share price slid 24% over twelve months. That's disappointing when you consider the market declined 1.0%. Because Dada Nexus hasn't been listed for many years, the market is still learning about how the business performs. It's down 41% in about a quarter. We note that the company has reported results fairly recently; and the market is hardly delighted. You can check out the latest numbers in our company report.
With the stock having lost 7.3% in the past week, it's worth taking a look at business performance and seeing if there's any red flags.
Check out our latest analysis for Dada Nexus
Dada Nexus isn't currently profitable, so most analysts would look to revenue growth to get an idea of how fast the underlying business is growing. Generally speaking, companies without profits are expected to grow revenue every year, and at a good clip. As you can imagine, fast revenue growth, when maintained, often leads to fast profit growth.
Dada Nexus grew its revenue by 37% over the last year. We think that is pretty nice growth. Unfortunately that wasn't good enough to stop the share price dropping 24%. This implies the market was expecting better growth. But if revenue keeps growing, then at a certain point the share price would likely follow.
You can see how earnings and revenue have changed over time in the image below (click on the chart to see the exact values).
Dada Nexus is a well known stock, with plenty of analyst coverage, suggesting some visibility into future growth. If you are thinking of buying or selling Dada Nexus stock, you should check out this free report showing analyst consensus estimates for future profits.
A Different Perspective
While Dada Nexus shareholders are down 24% for the year, the market itself is up 1.0%. However, keep in mind that even the best stocks will sometimes underperform the market over a twelve month period. It's worth noting that the last three months did the real damage, with a 41% decline. This probably signals that the business has recently disappointed shareholders - it will take time to win them back. 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. To that end, you should be aware of the 1 warning sign we've spotted with Dada Nexus .
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 American exchanges.
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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
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