This month, we saw the Global-e Online Ltd. (NASDAQ:GLBE) up an impressive 32%. But that is minimal compensation for the share price under-performance over the last year. In fact, the price has declined 26% in a year, falling short of the returns you could get by investing in an index fund.
On a more encouraging note the company has added US$125m to its market cap in just the last 7 days, so let's see if we can determine what's driven the one-year loss for shareholders.
Check out our latest analysis for Global-e Online
Given that Global-e Online didn't make a profit in the last twelve months, we'll focus on revenue growth to form a quick view of its business development. Generally speaking, companies without profits are expected to grow revenue every year, and at a good clip. As you can imagine, fast revenue growth, when maintained, often leads to fast profit growth.
In the last twelve months, Global-e Online increased its revenue by 63%. That's well above most other pre-profit companies. The share price drop of 26% 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).
NasdaqGS:GLBE Earnings and Revenue Growth January 23rd 2023
You can see how its balance sheet has strengthened (or weakened) over time in this free interactive graphic.
A Different Perspective
Global-e Online shareholders are down 26% for the year, even worse than the market loss of 10%. That's disappointing, but it's worth keeping in mind that the market-wide selling wouldn't have helped. Putting aside the last twelve months, it's good to see the share price has rebounded by 3.7%, in the last ninety days. This could just be a bounce because the selling was too aggressive, but fingers crossed it's the start of a new trend. I find it very interesting to look at share price over the long term as a proxy for business performance. But to truly gain insight, we need to consider other information, too. Take risks, for example - Global-e Online has 3 warning signs we think you should be aware of.
If you would prefer to check out another company -- one with potentially superior financials -- then do not miss this free list of companies that have proven they can grow earnings.
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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