We think intelligent long term investing is the way to go. But that doesn’t mean long term investors can avoid big losses. Zooming in on an example, the Provexis plc share price dropped 66% in the last half decade. That is extremely sub-optimal, to say the least.
We also note that the stock has performed poorly over the last year, with the share price down 21%. Check out our latest analysis for Provexis With just UK£305,298 worth of revenue in twelve months, we don’t think the market considers Provexis to have proven its business plan.
You have to wonder why venture capitalists aren’t funding it. So it seems that the investors focused more on what could be, than paying attention to the current revenues . Investors will be hoping that Provexis can make progress and gain better traction for the business, before it runs low on cash. We think companies that have neither significant revenues nor profits are pretty high risk.
There is usually a significant chance that they will need more money for business development, putting them at the mercy of capital markets. So the share price itself impacts the value of the shares . While some companies like this go on to deliver on their plan, making good money for shareholders, many end in painful losses and eventual de-listing. It certainly is a dangerous place to invest, as Provexis investors might realise.
You can click on the image below to see how Provexis’s cash levels have changed over time. More Of course, the truth is that it is hard to value companies without much revenue or profit. 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.
You might want to assess this data-rich visualization of its earnings, revenue and cash flow. So take a peek at this free list of interesting companies with past earnings growth . 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.
If you spot an error that warrants correction, please contact the editor at . 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. Thank you for reading.
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