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Even after rising 4.7% this past week, Home Consortium (ASX:HMC) shareholders are still down 9.0% over the past year – Simply Wall St

Home Consortium Limited (ASX:HMC) shareholders should be happy to see the share price up 19% in the last month. But that is minimal compensation for the share price under-performance over the last year. In fact the stock is dow…….

Home Consortium Limited (ASX:HMC) shareholders should be happy to see the share price up 19% in the last month. But that is minimal compensation for the share price under-performance over the last year. In fact the stock is down 11% in the last year, well below the market return.

The recent uptick of 4.7% could be a positive sign of things to come, so let’s take a lot at historical fundamentals.

See our latest analysis for Home Consortium

Home Consortium 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. That’s because fast revenue growth can be easily extrapolated to forecast profits, often of considerable size.

In the last year Home Consortium saw its revenue grow by 91%. That’s well above most other pre-profit companies. The share price drop of 11% over twelve months would be considered disappointing by many, so you might argue the company is getting little credit for its impressive revenue growth. Prima facie, revenue growth like that should be a good thing, so it’s worth checking whether losses have stabilized. Our brains have evolved to think in linear fashion, so there’s value in learning to recognize exponential growth. We are, in some ways, simply the wisest of the monkeys.

The company’s revenue and earnings (over time) are depicted in the image below (click to see the exact numbers).

ASX:HMC Earnings and Revenue Growth July 29th 2022

We consider it positive that insiders have made significant purchases in the last year. Even so, future earnings will be far more important to whether current shareholders make money. If you are thinking of buying or selling Home Consortium stock, you should check out this free report showing analyst profit forecasts.

A Different Perspective

We doubt Home Consortium shareholders are happy with the loss of 9.0% over twelve months (even including dividends). That falls short of the market, which lost 4.0%. There’s no doubt that’s a disappointment, but the stock may well have fared better in a stronger market. It’s worth noting that the last three months did the real damage, with a 21% decline. So it seems like some holders have been dumping the stock of late – and that’s not bullish. 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. For instance, we’ve identified 1 warning sign for Home Consortium that you should be aware of.

There are plenty of other companies that have insiders buying …….

Source: https://simplywall.st/stocks/au/real-estate/asx-hmc/home-consortium-shares/news/even-after-rising-47-this-past-week-home-consortium-asxhmc-s

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