Babcock & Wilcox Enterprises, Inc. (NYSE:BW) shareholders will doubtless be very grateful to see the share price up 82% in the last month. But that doesn't change the fact that the returns over the last three years have been disappointing. Tragically, the share price declined 68% in that time. So it is really good to see an improvement. Perhaps the company has turned over a new leaf.

While the stock has risen 10% in the past week but long term shareholders are still in the red, let's see what the fundamentals can tell us.

View our latest analysis for Babcock & Wilcox Enterprises

Given that Babcock & Wilcox Enterprises 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. Shareholders of unprofitable companies usually desire strong revenue growth. 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.

Over three years, Babcock & Wilcox Enterprises grew revenue at 14% per year. That's a fairly respectable growth rate. That contrasts with the weak share price, which has fallen 19% compounded, over three years. To be frank we're surprised to see revenue growth and share price growth diverge so strongly. It would be well worth taking a closer look at the company, to determine growth trends (and balance sheet strength).

The graphic below depicts how earnings and revenue have changed over time (unveil the exact values by clicking on the image).

We consider it positive that insiders have made significant purchases in the last year. Even so, future earnings will be far more important to whether current shareholders make money. This free report showing analyst forecasts should help you form a view on Babcock & Wilcox Enterprises

A Different Perspective

Babcock & Wilcox Enterprises shareholders are down 40% for the year, but the market itself is up 35%. 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 9% 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. I find it very interesting to look at share price over the long term as a proxy for business performance. But to truly gain insight, we need to consider other information, too. To that end, you should learn about the 3 warning signs we've spotted with Babcock & Wilcox Enterprises (including 1 which can't be ignored) .