Advertisement
UK markets close in 3 hours 18 minutes
  • FTSE 100

    8,173.95
    +31.80 (+0.39%)
     
  • FTSE 250

    20,301.07
    +141.35 (+0.70%)
     
  • AIM

    777.84
    +2.91 (+0.38%)
     
  • GBP/EUR

    1.1825
    -0.0009 (-0.08%)
     
  • GBP/USD

    1.2675
    -0.0029 (-0.23%)
     
  • Bitcoin GBP

    51,508.17
    -339.59 (-0.65%)
     
  • CMC Crypto 200

    1,358.84
    -30.57 (-2.20%)
     
  • S&P 500

    5,473.23
    +41.63 (+0.77%)
     
  • DOW

    38,778.10
    +188.94 (+0.49%)
     
  • CRUDE OIL

    80.24
    -0.09 (-0.11%)
     
  • GOLD FUTURES

    2,327.50
    -1.50 (-0.06%)
     
  • NIKKEI 225

    38,482.11
    +379.67 (+1.00%)
     
  • HANG SENG

    17,915.55
    -20.57 (-0.11%)
     
  • DAX

    18,094.38
    +26.17 (+0.14%)
     
  • CAC 40

    7,600.23
    +28.66 (+0.38%)
     

Loss-making Wizz Air Holdings (LON:WIZZ) has seen earnings and shareholder returns follow the same downward trajectory over past -47%

It is a pleasure to report that the Wizz Air Holdings Plc (LON:WIZZ) is up 80% in the last quarter. But that doesn't change the fact that the returns over the last year have been less than pleasing. After all, the share price is down 47% in the last year, significantly under-performing the market.

The recent uptick of 34% could be a positive sign of things to come, so let's take a look at historical fundamentals.

See our latest analysis for Wizz Air Holdings

Given that Wizz Air Holdings 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. Shareholders of unprofitable companies usually expect strong revenue growth. As you can imagine, fast revenue growth, when maintained, often leads to fast profit growth.

ADVERTISEMENT

In the last twelve months, Wizz Air Holdings increased its revenue by 159%. That's well above most other pre-profit companies. Given the revenue growth, the share price drop of 47% seems quite harsh. Our sympathies to shareholders who are now underwater. On the bright side, if this company is moving profits in the right direction, top-line growth like that could be an opportunity. Our brains have evolved to think in linear fashion, so there's value in learning to recognize exponential growth. We are, in some ways, simply the wisest of the monkeys.

The graphic below depicts how earnings and revenue have changed over time (unveil the exact values by clicking on the image).

earnings-and-revenue-growth
earnings-and-revenue-growth

We like that insiders have been buying shares in the last twelve months. Having said that, most people consider earnings and revenue growth trends to be a more meaningful guide to the business. So it makes a lot of sense to check out what analysts think Wizz Air Holdings will earn in the future (free profit forecasts).

A Different Perspective

We regret to report that Wizz Air Holdings shareholders are down 47% for the year. Unfortunately, that's worse than the broader market decline of 2.5%. 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. Regrettably, last year's performance caps off a bad run, with the shareholders facing a total loss of 5% per year over five years. 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. Like risks, for instance. Every company has them, and we've spotted 3 warning signs for Wizz Air Holdings (of which 1 shouldn't be ignored!) you should know about.

There are plenty of other companies that have insiders buying up shares. You probably do 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 GB 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