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TRX Gold (TSE: TNX shareholders suffer further losses as shares fall 16% this week, bringing three-year losses to 54%

The truth is, if you invest long enough, you’re going to end up with losing stocks. But the last three years have been particularly difficult in the long term TRX Gold Corporation (EAST: TNX) shareholders. Unfortunately for them, the stock price fell 54% during this time. Unfortunately, the stock price momentum is still quite negative, with prices down 27% in thirty days.

After losing 16% last week, it’s worth looking at company fundamentals to see what we can infer from past performance.

Check out our latest analysis for TRX Gold

Since TRX Gold has not made a profit in the past twelve months, we will focus on revenue growth to get a quick overview of its business development. Generally speaking, companies without profits should increase their revenue every year, and at a good pace. Indeed, rapid revenue growth can be easily extrapolated to predict profits, often of considerable size.

Over the past three years, TRX Gold has seen its revenue grow by 164% per year, compounded. It’s faster than most nonprofits. The stock price moved in the opposite direction, down 15% over this period, a poor result. This could mean that the hype has gone out of the stock because the losses are about investors. But a drop in the stock price of this magnitude could well signal that the market is too negative on the stock.

The image below shows how earnings and income have tracked over time (if you click on the image you can see more details).

earnings-and-revenue-growth

We consider it positive that insiders have made significant purchases over the past year. That said, most people consider profit and revenue growth trends to be a more meaningful guide to the business. You can see what analysts are predicting for TRX Gold in this interactive graph of future earnings estimates.

A different perspective

We regret to report that TRX Gold shareholders are down 19% for the year. Unfortunately, this is worse than the general market decline of 4.6%. However, it could simply be that the stock price was impacted by greater market jitters. It might be worth keeping an eye on the fundamentals, in case there is a good opportunity. Longer-term investors wouldn’t be so upset, as they would have gained 4%, every year, over five years. If fundamentals continue to point to sustainable long-term growth, the current sell-off could be an opportunity to consider. While it’s worth considering the various impacts that market conditions can have on the stock price, there are other, even more important factors. Take for example the ubiquitous specter of investment risk. We have identified 3 warning signs with TRX Gold (at least 1 which is significant) and understanding them should be part of your investment process.

TRX Gold isn’t the only stock insiders are buying. So take a look at this free list of growing companies with insider buying.

Please note that the market returns quoted in this article reflect the average market-weighted returns of stocks currently trading on CA exchanges.

Feedback on this article? Concerned about content? Get in touch with us directly. You can also email the editorial team (at) Simplywallst.com.

This Simply Wall St article is general in nature. We provide commentary based on historical data and analyst forecasts only using unbiased methodology and our articles are not intended to be financial advice. It is not a recommendation to buy or sell stocks and does not take into account your objectives or financial situation. Our goal is to bring you targeted long-term analysis based on fundamental data. Note that our analysis may not take into account the latest announcements from price-sensitive companies or qualitative materials. Simply Wall St has no position in the stocks mentioned.

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