ASAN - Asana Just Surprised Wall Street but Is Buying Shares Now a Mistake?
2023-03-22 07:30:00 ET
Stock prices move every day for a host of reasons, but when a company announces its latest quarterly results, investors get a trove of financial information that can help them understand if it's on track. What they can't necessarily know, however, is whether any given quarter's results are part of a trend or just outliers.
Investors may be wondering that very thing about the numbers that work productivity software company Asana (NYSE: ASAN) delivered this month. Its results for its fiscal 2023 fourth quarter, which ended Jan. 31, sent the stock soaring by nearly 19%. Even after that pop, shares are still trading down more than 50% from their 12-month high. Let's take a closer look at the last quarter's results to see if they suggest that the stock is a buy now.
Asana caught the attention of investors because of its revenue and customer growth, which have been outstanding for the entire time the company has been public. However, it has also been unprofitable and burning cash. Those negatives were easier for investors to ignore while interest rates were near zero and the market was booming, but over the last several quarters, the market has been more critical. Asana's increasing operating losses and lack of progress toward profitability likely contributed to the stock's fall.
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Asana Just Surprised Wall Street, but Is Buying Shares Now a Mistake?