This week we saw the Bloom Energy Corporation (NYSE:BE) share price climb by 18%. But that doesn’t change the fact that the returns over the last year have been disappointing. Specifically, the stock price slipped by 58% in that time. It’s not that amazing to see a bounce after a drop like that. Arguably, the fall was overdone.
While the last year has been tough for Bloom Energy shareholders, this past week has shown signs of promise. So let’s look at the longer term fundamentals and see if they’ve been the driver of the negative returns.
See our latest analysis for Bloom Energy
Because Bloom Energy 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. When a company doesn’t make profits, we’d generally expect to see good revenue growth. As you can imagine, fast revenue growth, when maintained, often leads to fast profit growth.
In the last year Bloom Energy saw its revenue grow by 16%. We think that is pretty nice growth. Unfortunately it seems investors wanted more, because the share price is down 58% in that time. It may well be that the business remains approximately on track, but its revenue growth has simply been delayed. To our minds it isn’t enough to just look at revenue, anyway. Always consider when profits will flow.
You can see below how earnings and revenue have changed over time (discover the exact values by clicking on the image).
We consider it positive that insiders have made significant purchases in the last year. 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 Bloom Energy will earn in the future (free profit forecasts).
A Different Perspective
Over the last year, Bloom Energy shareholders took a loss of 58%. In contrast the market gained about 2.3%. Of course the long term matters more than the short term, and even great stocks will sometimes have a poor year. Fortunately the longer term story is brighter, with total returns averaging about 14% per year over three years. 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. 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. Consider risks, for instance. Every company has them, and we’ve spotted 3 warning signs for Bloom Energy you should know about.
Bloom Energy is not the only stock that insiders are buying. For those who like to find winning investments this free list of growing companies with recent insider purchasing, could be just the ticket.
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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