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While it may not be enough for some shareholders, we think it is good to see the Compagnie Internationale pour la Communication (VTX:CIE) share price up 12% in a single quarter. But that doesn't change the fact that the returns over the last three years have been disappointing. Indeed, the share price is down a tragic 52% in the last three years. So it is really good to see an improvement. Perhaps the company has turned over a new leaf.
View our latest analysis for Compagnie Internationale pour la Communication
With zero revenue generated over twelve months, we don't think that Compagnie Internationale pour la Communication has proved its business plan yet. We can't help wondering why it's publicly listed so early in its journey. Are venture capitalists not interested? So it seems shareholders are too busy dreaming about the progress to come than dwelling on the current (lack of) revenue. Investors will be hoping that Compagnie Internationale pour la Communication 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 (as it determines the cost of capital). While some such companies go on to make revenue, profits, and generate value, others get hyped up by hopeful naifs before eventually going bankrupt. Compagnie Internationale pour la Communication has already given some investors a taste of the bitter losses that high risk investing can cause.
Our data indicates that Compagnie Internationale pour la Communication had net debt of CHF10,259,182 when it last reported in June 2018. That makes it extremely high risk, in our view. But with the share price diving 22% per year, over 3 years, it's probably fair to say that some shareholders no longer believe the company will succeed. You can click on the image below to see (in greater detail) how Compagnie Internationale pour la Communication's cash levels have changed over time.
It can be extremely risky to invest in a company that doesn't even have revenue. There's no way to know its value easily. Would it bother you if insiders were selling the stock? I'd like that just about as much as I like to drink milk and fruit juice mixed together. It only takes a moment for you to check whether we have identified any insider sales recently.