Investing in stocks inevitably means buying into some companies that perform poorly. But the last three years have been particularly tough on longer term Sherritt International Corporation (TSE:S) shareholders. So they might be feeling emotional about the 59% share price collapse, in that time. And more recent buyers are having a tough time too, with a drop of 54% in the last year. Shareholders have had an even rougher run lately, with the share price down 15% in the last 90 days.

It's worthwhile assessing if the company's economics have been moving in lockstep with these underwhelming shareholder returns, or if there is some disparity between the two. So let's do just that.

View our latest analysis for Sherritt International

Given that Sherritt International 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. Some companies are willing to postpone profitability to grow revenue faster, but in that case one would hope for good top-line growth to make up for the lack of earnings.

In the last three years, Sherritt International saw its revenue grow by 22% per year, compound. That is faster than most pre-profit companies. In contrast, the share price is down 17% compound, over three years - disappointing by most standards. This could mean hype has come out of the stock because the losses are concerning investors. But a share price drop of that magnitude could well signal that the market is overly negative on the stock.

The company's revenue and earnings (over time) are depicted in the image below (click to see the exact numbers).

You can see how its balance sheet has strengthened (or weakened) over time in this free interactive graphic.

A Different Perspective

Investors in Sherritt International had a tough year, with a total loss of 54%, against a market gain of about 32%. Even the share prices of good stocks drop sometimes, but we want to see improvements in the fundamental metrics of a business, before getting too interested. Regrettably, last year's performance caps off a bad run, with the shareholders facing a total loss of 3% per year over five years. Generally speaking long term share price weakness can be a bad sign, though contrarian investors might want to research the stock in hope of a turnaround. It's always interesting to track share price performance over the longer term. But to understand Sherritt International better, we need to consider many other factors. To that end, you should be aware of the 1 warning sign we've spotted with Sherritt International .