Yahoo Finance Those Who Purchased Diamond Offshore Drilling (NYSE:DO) Shares Five Years Ago Have A 84% Loss To Show For It
Some stocks are best avoided. It hits us in the gut when we see fellow investors suffer a loss. Spare a thought for those who held Diamond Offshore Drilling, Inc. (NYSE:DO) for five whole years - as the share price tanked 84%. We also note that the stock has performed poorly over the last year, with the share price down 41%. Shareholders have had an even rougher run lately, with the share price down 30% in the last 90 days.
We really hope anyone holding through that price crash has a diversified portfolio. Even when you lose money, you don't have to lose the lesson.
See our latest analysis for Diamond Offshore Drilling
Diamond Offshore Drilling isn't currently profitable, so most analysts would look to revenue growth to get an idea of how fast the underlying business is growing. 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.
Over half a decade Diamond Offshore Drilling reduced its trailing twelve month revenue by 23% for each year. That's definitely a weaker result than most pre-profit companies report. So it's not altogether surprising to see the share price down 31% per year in the same time period. We don't think this is a particularly promising picture. Of course, the poor performance could mean the market has been too severe selling down. That can happen.
You can see how earnings and revenue have changed over time in the image below (click on the chart to see the exact values).
Diamond Offshore Drilling is well known by investors, and plenty of clever analysts have tried to predict the future profit levels. So we recommend checking out this free report showing consensus forecasts
A Different Perspective
Diamond Offshore Drilling shareholders are down 41% for the year, but the market itself is up 25%. Even the share prices of good stocks drop sometimes, but we want to see improvements in the fundamental metrics of a business, before getting too interested. Regrettably, last year's performance caps off a bad run, with the shareholders facing a total loss of 31% 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. If you would like to research Diamond Offshore Drilling in more detail then you might want to take a look at whether insiders have been buying or selling shares in the company.
Of course Diamond Offshore Drilling may not be the best stock to buy. So you may wish to see this free collection of growth stocks.
Please note, the market returns quoted in this article reflect the market weighted average returns of stocks that currently trade on US exchanges.
If you spot an error that warrants correction, please contact the editor at editorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned.
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Thank you for reading.
