Introducing Mondo TV France Société Anonyme (BIT:MTF), The Stock That Tanked 83%

As an investor, mistakes are inevitable. But you have a problem if you face massive losses more than once in a while. So consider, for a moment, the misfortune of Mondo TV France Société Anonyme (BIT:MTF) investors who have held the stock for three years as it declined a whopping 83%. That would certainly shake our confidence in the decision to own the stock. And more recent buyers are having a tough time too, with a drop of 53% in the last year. In contrast, the stock price has popped 8.7% in the last thirty days.

While a drop like that is definitely a body blow, money isn't as important as health and happiness.

View our latest analysis for Mondo TV France Société Anonyme

Mondo TV France Société Anonyme isn't currently profitable, so most analysts would look to revenue growth to get an idea of how fast the underlying business is growing. When a company doesn't make profits, we'd generally expect to see good revenue growth. That's because fast revenue growth can be easily extrapolated to forecast profits, often of considerable size.

Over three years, Mondo TV France Société Anonyme grew revenue at 63% per year. That's well above most other pre-profit companies. So on the face of it we're really surprised to see the share price down 45% a year in the same time period. You'd want to take a close look at the balance sheet, as well as the losses. Ultimately, revenue growth doesn't amount to much if the business can't scale well. If the company is low on cash, it may have to raise capital soon.

You can see how earnings and revenue have changed over time in the image below (click on the chart to see the exact values).

BIT:MTF Income Statement, October 22nd 2019
BIT:MTF Income Statement, October 22nd 2019

Take a more thorough look at Mondo TV France Société Anonyme's financial health with this free report on its balance sheet.

A Different Perspective

While the broader market gained around 19% in the last year, Mondo TV France Société Anonyme shareholders lost 53%. 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 28% per year over five years. We realise that Buffett has said investors should 'buy when there is blood on the streets', but we caution that investors should first be sure they are buying a high quality businesses. Before spending more time on Mondo TV France Société Anonyme it might be wise to click here to see if insiders have been buying or selling shares.

If you are like me, then you will 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 IT exchanges.

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 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. Thank you for reading.