Funding Circle Holdings (LON:FCH) investors are sitting on a loss of 70% if they invested three years ago

If you love investing in stocks you're bound to buy some losers. But the last three years have been particularly tough on longer term Funding Circle Holdings plc (LON:FCH) shareholders. Unfortunately, they have held through a 70% decline in the share price in that time. Furthermore, it's down 34% in about a quarter. That's not much fun for holders.

So let's have a look and see if the longer term performance of the company has been in line with the underlying business' progress.

See our latest analysis for Funding Circle Holdings

There is no denying that markets are sometimes efficient, but prices do not always reflect underlying business performance. One flawed but reasonable way to assess how sentiment around a company has changed is to compare the earnings per share (EPS) with the share price.

Funding Circle Holdings became profitable within the last five years. We would usually expect to see the share price rise as a result. So it's worth looking at other metrics to try to understand the share price move.

Revenue is actually up 5.5% over the three years, so the share price drop doesn't seem to hinge on revenue, either. It's probably worth investigating Funding Circle Holdings further; while we may be missing something on this analysis, there might also be an opportunity.

You can see how earnings and revenue have changed over time in the image below (click on the chart to see the exact values).

earnings-and-revenue-growth

We consider it positive that insiders have made significant purchases in the last year. Having said that, most people consider earnings and revenue growth trends to be a more meaningful guide to the business. So we recommend checking out this free report showing consensus forecasts

A Different Perspective

Funding Circle Holdings shareholders are up 8.6% for the year. Unfortunately this falls short of the market return of around 12%. On the bright side, that's certainly better than the yearly loss of about 19% endured over the last three years, implying that the company is doing better recently. We hope the turnaround in fortunes continues. It's always interesting to track share price performance over the longer term. But to understand Funding Circle Holdings better, we need to consider many other factors. Consider risks, for instance. Every company has them, and we've spotted 1 warning sign for Funding Circle Holdings you should know about.

Funding Circle Holdings is not the only stock insiders are buying. So take a peek at this free list of growing companies with insider buying.

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