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It is doubtless a positive to see that the Coro Energy plc (LON:CORO) share price has gained some 48% in the last three months. But in truth the last year hasn't been good for the share price. The cold reality is that the stock has dropped 13% in one year, under-performing the market.
View our latest analysis for Coro Energy
Coro Energy recorded just US$2,096,039 in revenue over the last twelve months, which isn't really enough for us to consider it to have a proven product. You have to wonder why venture capitalists aren't funding it. So it seems shareholders are too busy dreaming about the progress to come than dwelling on the current (lack of) revenue. It seems likely some shareholders believe that Coro Energy will discover or develop fossil fuel before too long.
Companies that lack both meaningful revenue and profits are usually considered high risk. There is almost always a chance they will need to raise more capital, and their progress - and share price - will dictate how dilutive that is to current holders. While some such companies do very well over the long term, others become hyped up by promoters before eventually falling back down to earth, and going bankrupt (or being recapitalized).
Coro Energy had liabilities exceeding cash by US$21,611,000 when it last reported in June 2019, according to our data. That puts it in the highest risk category, according to our analysis. But since the share price has dived -13% in the last year, it looks like some investors think it's time to abandon ship, so to speak. You can see in the image below, how Coro Energy's cash levels have changed over time (click to see the values). You can click on the image below to see (in greater detail) how Coro Energy's cash levels have changed over time.
In reality it's hard to have much certainty when valuing a business that has neither revenue or profit. 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. You can click here to see if there are insiders selling.
A Different Perspective
While Coro Energy shareholders are down 13% for the year, the market itself is up 4.1%. While the aim is to do better than that, it's worth recalling that even great long-term investments sometimes underperform for a year or more. It's great to see a nice little 48% rebound in the last three months. Let's just hope this isn't the widely-feared 'dead cat bounce' (which would indicate further declines to come). Most investors take the time to check the data on insider transactions. You can click here to see if insiders have been buying or selling.