Over the last month the Perimeter Solutions, SA (NYSE:PRM) has been much stronger than before, rebounding by 31%. The stock is actually down over the last year. But it did better than its market, which fell 18%.
The recent uptick of 5.3% could be a positive sign of things to come, so let's take a look at historical fundamentals.
Given that Perimeter Solutions 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. Some companies are willing to postpone profitability to grow revenue faster, but in that case one does expect good top-line growth.
Perimeter Solutions' revenue didn't grow at all in the last year. In fact, it fell 1.9%. That looks pretty grim, at a glance. The stock price only fell 11% in that period, not a bad result. So it seems that the market saw the weak revenue coming, and isn't worried. It could be interesting to study this stock more closely - when will it generate profits?
The company's revenue and earnings (over time) are depicted in the image below (click to see the exact numbers).
Balance sheet strength is crucial. It might be well worthwhile taking a look at our free report on how its financial position has changed over time.
A Different Perspective
While they no doubt would have preferred make a profit, at least Perimeter Solutions shareholders didn't do too badly in the last year. Their loss of 11%, actually beat the broader market, which lost around 18%. At least the recent returns have been positive, with the stock up 7.1% in around 90 days. The recent uptick could be an early suggestion that the prior falls were too extreme; but we'll need to see how the business progresses. 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. Consider for instance, the ever-present spectre of investment risk. We've identified 1 warning sign with Perimeter Solutions , and understanding them should be part of your investment process.
If you are like me, then you will not want to miss this free list of growing companies that insiders are buying.
Please note, the market returns quoted in this article reflect the market weighted average returns of stocks that currently trade on US 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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