The past five years for LiveHire (ASX:LVH) investors has not been profitable




  • In Business
  • 2022-08-08 22:35:43Z
  • By Simply Wall St.
 

We think intelligent long term investing is the way to go. But along the way some stocks are going to perform badly. To wit, the LiveHire Limited (ASX:LVH) share price managed to fall 55% over five long years. That is extremely sub-optimal, to say the least. And it's not just long term holders hurting, because the stock is down 25% in the last year. More recently, the share price has dropped a further 29% in a month.

Now let's have a look at the company's fundamentals, and see if the long term shareholder return has matched the performance of the underlying business.

See our latest analysis for LiveHire

Because LiveHire made a loss in the last twelve months, we think the market is probably more focussed on revenue and revenue growth, at least for now. Shareholders of unprofitable companies usually expect strong revenue growth. As you can imagine, fast revenue growth, when maintained, often leads to fast profit growth.

In the last half decade, LiveHire saw its revenue increase by 40% per year. That's better than most loss-making companies. Unfortunately for shareholders the share price has dropped 9% per year - disappointing considering the growth. This could mean high expectations have been tempered, potentially because investors are looking to the bottom line. If you think the company can keep up its revenue growth, you'd have to consider the possibility that there's an opportunity here.

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

We regret to report that LiveHire shareholders are down 25% for the year. Unfortunately, that's worse than the broader market decline of 2.3%. However, it could simply be that the share price has been impacted by broader market jitters. It might be worth keeping an eye on the fundamentals, in case there's a good opportunity. Unfortunately, last year's performance may indicate unresolved challenges, given that it was worse than the annualised loss of 9% over the last half decade. Generally speaking long term share price weakness can be a bad sign, though contrarian investors might want to research the stock in hope of a turnaround. While it is well worth considering the different impacts that market conditions can have on the share price, there are other factors that are even more important. Even so, be aware that LiveHire is showing 4 warning signs in our investment analysis , you should know about...

Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of companies we expect will grow earnings.

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

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.

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.

Join A Paid User Research Session
You'll receive a US$30 Amazon Gift card for 1 hour of your time while helping us build better investing tools for the individual investors like yourself. Sign up here

COMMENTS

More Related News

We
We're Interested To See How Frontier Energy (ASX:FHE) Uses Its Cash Hoard To Grow

Just because a business does not make any money, does not mean that the stock will go down. For example, although...

VeriSign
VeriSign's (NASDAQ:VRSN) investors will be pleased with their favorable 63% return over the last five years

Stock pickers are generally looking for stocks that will outperform the broader market. And the truth is, you can make...

Earnings growth of 2.8% over 1 year hasn
Earnings growth of 2.8% over 1 year hasn't been enough to translate into positive returns for Lufax Holding (NYSE:LU) shareholders

Even the best stock pickers will make plenty of bad investments. And unfortunately for Lufax Holding Ltd ( NYSE:LU...

Atlanticus Holdings (NASDAQ:ATLC) pulls back 17% this week, but still delivers shareholders enviable 60% CAGR over 5 years
Atlanticus Holdings (NASDAQ:ATLC) pulls back 17% this week, but still delivers shareholders enviable 60% CAGR over 5 years

The last three months have been tough on Atlanticus Holdings Corporation ( NASDAQ:ATLC ) shareholders, who have seen...

Earnings growth of 16% over 1 year hasn
Earnings growth of 16% over 1 year hasn't been enough to translate into positive returns for Netflix (NASDAQ:NFLX) shareholders

Netflix, Inc. ( NASDAQ:NFLX ) shareholders should be happy to see the share price up 25% in the last quarter. But...

Leave a Comment

Your email address will not be published. Required fields are marked with *

Cancel reply

Comments

Top News: Business