Economy IQIYI's (NASDAQ: IQ) stock price has dropped 18%, so...

IQIYI’s (NASDAQ: IQ) stock price has dropped 18%, so some shareholders are concerned

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<p class = "canvas-atom canvas-text Mb (1.0em) Mb (0) – sm Mt (0.8em) – sm" type = "text" content = "The easiest way to benefit from an increasing market is If you buy individual stocks, you can make higher profits, but you are also at risk of underperformance iQIYI, Inc. (NASDAQ: IQ) shareholders last year when the share price fell 18%. That is well below the market return of -11%. Since iQIYI has not been listed for many years, the market is still learning how business develops. The past month has also been disappointing as the stock fell another 23%. However, we find that the broader market has fallen 22% over this period, which may have weighed on the share price. “Data-reactid =” 28 “> The easiest way to take advantage of a rising market is to buy an index fund. When you buy individual stocks, you can make higher profits, but you are also at risk of underperformance. This downside risk was realized by iQIYI, Inc. (NASDAQ: IQ) shareholders last year when the share price fell 18%. That is well below the market return of -11%. Since iQIYI has not been listed for many years, the market is still learning how business develops. The past month has also been disappointing as the stock fell another 23%. However, we find that the broader market has fallen 22% over this period, which may have weighed on the share price.

<p class = "Artboard-Atom Artboard-Text Mb (1.0em) Mb (0) – sm Mt (0.8em) – sm" type = "text" content = " Check out our latest analysis for iQIYI “data-reactid =” 29 “> Check out our latest analysis for iQIYI

Since iQIYI has not made a profit in the past twelve months, we focus on sales growth to get a quick overview of business development. When a company is not making a profit, we generally expect good sales growth. As you can imagine, rapid growth in sales while maintaining often leads to rapid profit growth.

iQIYI increased its sales by 16% last year. We think that’s pretty nice growth. Unfortunately, that was not good enough to stop the price drop 18%. This implies that the market expected better growth. However, that is now in the past and it is the future that matters most.

The picture below shows how earnings and earnings have accumulated over time (click on the picture to see more details).

NasdaqGS: IQ Income Statement March 26, 2020

NasdaqGS: IQ Income Statement March 26, 2020

iQIYI is a well-known stock with plenty of analyst reporting, which indicates some insight into future growth. It is therefore very useful to check what analysts assume that iQIYI will earn in the future (free analyst consensus estimates).

Another perspective

<p class = "canvas-atom canvas-text Mb (1.0em) Mb (0) – sm Mt (0.8em) – sm" type = "text" content = "iQIYI shareholders fell 18% over the course of the year, yet worse than the 11% market loss. There is no doubt that this is a disappointment, but the stock may have performed better in a stronger market. As the stock has fallen 14% in the past three months, the market does not appear to believe In general, most investors should be careful about buying a poorly performing stock unless the business itself has improved significantly. It is always interesting to track the stock's price performance over the long term. But to understand iQIYI better, we have many other factors to consider, for example, we discovered 3 warning signs for iQIYI You should be aware of this. “data-reactid =” 47 “> iQIYI shareholders fell 18% over the course of the year, even worse than the 11% market loss. There is no doubt that this is a disappointment, but the stock may have performed better a stronger market, as the stock has dropped 14% over the past three months, the market does not seem to believe that the company has resolved all of its problems, and most investors should be cautious about buying in a poorly performing stock Unless the business itself has improved significantly. It is always interesting to follow the price development in the long term. However, to understand iQIYI better, we have to consider many other factors. A typical example: We have found 3 warning signs for iQIYI You should be aware of this.

<p class = "canvas-atom canvas-text Mb (1.0em) Mb (0) – sm Mt (0.8em) – sm" type = "text" content = "For those who like to find Win investments This free List of growing companies with recent insider purchases might be just the thing. “data-reactid =” 48 “> For those who like to find Win investments This free List of growing companies with recent insider buying might be just the thing.

<p class = "Artboard-Atom Artboard-Text Mb (1.0em) Mb (0) – sm Mt (0.8em) – sm" type = "text" content = "Please note that the market returns listed in this article reflect the market-weighted average returns on stocks currently traded on US stock exchanges.“data-reactid =” 49 “>Please note that the market returns listed in this article reflect the market-weighted average returns on stocks currently traded on US stock exchanges.

<p class = "Artboard-Atom Artboard-Text Mb (1.0em) Mb (0) – sm Mt (0.8em) – sm" type = "text" content = "If you find an error that warrants a correction, please contact the publisher at [email protected] This article from Simply Wall St is general in nature. It is not a recommendation to buy or sell shares and does not take into account your goals or your financial situation. Simply Wall St has no position in the stocks mentioned.

We would like to provide you with a long-term focused research analysis based on fundamental data. Note that our analysis may not take into account the latest price-sensitive company announcements or quality materials. Thank you for reading.“data-reactid =” 50 “>If you find an error that warrants a correction, please contact the publisher at [email protected] This article from Simply Wall St is general in nature. It is not a recommendation to buy or sell shares and does not take into account your goals or your financial situation. Simply Wall St has no position in the stocks mentioned.

We would like to provide you with a long-term focused research analysis based on fundamental data. Note that our analysis may not take into account the latest price-sensitive company announcements or quality materials. Thank you for reading.

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