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It's nice to see the Oatly Group AB (NASDAQ:OTLY) share price up 23% in a week. But that is meagre solace when you consider how the price has plummeted over the last year. Indeed, the share price is down a whopping 78% in the last year. So it's not that amazing to see a bit of a bounce. Only time will tell if the company can sustain the turnaround.
While the last year has been tough for Oatly Group shareholders, this past week has shown signs of promise. So let's look at the longer term fundamentals and see if they've been the driver of the negative returns.
See our latest analysis for Oatly Group
Oatly Group wasn't profitable in the last twelve months, it is unlikely we'll see a strong correlation between its share price and its earnings per share (EPS). Arguably revenue is our next best option. When a company doesn't make profits, we'd generally expect to see good revenue growth. That's because it's hard to be confident a company will be sustainable if revenue growth is negligible, and it never makes a profit.
In the last twelve months, Oatly Group increased its revenue by 22%. We think that is pretty nice growth. Unfortunately, the market wanted something better, given it sent the share price 78% lower during the year. It could be that the losses are too much for investors to handle without losing their nerve. We'd posit that the future looks challenging, given the disconnect between revenue growth and the share price.
You can see below how earnings and revenue have changed over time (discover the exact values by clicking on the image).
Oatly Group is a well known stock, with plenty of analyst coverage, suggesting some visibility into future growth. You can see what analysts are predicting for Oatly Group in this interactive graph of future profit estimates.
A Different Perspective
We doubt Oatly Group shareholders are happy with the loss of 78% over twelve months. That falls short of the market, which lost 22%. There's no doubt that's a disappointment, but the stock may well have fared better in a stronger market. With the stock down 34% over the last three months, the market doesn't seem to believe that the company has solved all its problems. Given the relatively short history of this stock, we'd remain pretty wary until we see some strong business performance. It's always interesting to track share price performance over the longer term. But to understand Oatly Group better, we need to consider many other factors. For example, we've discovered 3 warning signs for Oatly Group (1 is significant!) that you should be aware of before investing here.