Yahoo Finance The past year for OnTheMarket (LON:OTMP) investors has not been profitable
Passive investing in an index fund is a good way to ensure your own returns roughly match the overall market. But if you buy individual stocks, you can do both better or worse than that. Unfortunately the OnTheMarket plc (LON:OTMP) share price slid 31% over twelve months. That's well below the market decline of 4.9%. The silver lining (for longer term investors) is that the stock is still 2.1% higher than it was three years ago. Shareholders have had an even rougher run lately, with the share price down 22% in the last 90 days.
Since shareholders are down over the longer term, lets look at the underlying fundamentals over the that time and see if they've been consistent with returns.
View our latest analysis for OnTheMarket
OnTheMarket wasn't profitable in the last twelve months, it is unlikely we'll see a strong correlation between its share price and its earnings per share (EPS). Arguably revenue is our next best option. Shareholders of unprofitable companies usually expect strong revenue growth. That's because fast revenue growth can be easily extrapolated to forecast profits, often of considerable size.
In the last twelve months, OnTheMarket increased its revenue by 17%. We think that is pretty nice growth. Meanwhile, the share price is down 31% over twelve months, which is disappointing given the progress made. 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).
Take a more thorough look at OnTheMarket's financial health with this free report on its balance sheet.
A Different Perspective
OnTheMarket shareholders are down 31% for the year, falling short of the market return. Meanwhile, the broader market slid about 4.9%, likely weighing on the stock. Investors are up over three years, booking 0.7% per year, much better than the more recent returns. Sometimes when a good quality long term winner has a weak period, it's turns out to be an opportunity, but you really need to be sure that the quality is there. It's always interesting to track share price performance over the longer term. But to understand OnTheMarket better, we need to consider many other factors. For instance, we've identified 1 warning sign for OnTheMarket that you should be aware of.
If you would prefer to check out another company -- one with potentially superior financials -- then do not miss this free list of companies that have proven they can grow earnings.
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.
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