If You Invested $1,000 In Naked Brand Stock One Year Ago, Here's How Much You'd Have Now

Investors who have owned stocks in the last year have generally experienced some big gains. In fact, the SPDR S&P 500's SPY total return over the last12 months is 42%. But there is no question some big-name stocks performed better than others along the way.

Naked’s Difficult Road: One company that has been a roller coaster investment in the past year has been apparel and swimwear company Naked Brand Group Ltd NAKD.

Entering 2020, Naked stock had an abysmal long-term track record. In fact, the stock has now lost 99.9% of its overall value in the last three years.

That level of extreme value destruction has come as a result of falling sales, rising losses and extreme dilution. In fact, Naked’s outstanding share count is up a mind-boggling 340,400% over those three years. 

In 2019, Naked generated a $49.2-million net loss on $111.9 million in revenue. In 2020, those numbers dropped to a net loss of $54.3 million on just $90 million in revenue.

At the beginning of 2020, Naked shares were trading at $1.60, even after completing a 1-for-100 reverse stock split in December 2019. By the beginning of March, the stock was back down to 48.9 cents as news of the virus spreading in China prompted concerns about a U.S. pandemic.

On March 9, Naked shares dropped all the way down to 36.1 cents in intraday trading. However, while March 2020 was the low point for the stock market as a whole, Naked Brand shares were nowhere near their bottom.

Naked shares recovered to as high as $2.62 by early June before the sell-off resumed. Naked Brand ultimately bottomed at just 6.61 cents in October 2020.

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Naked In 2021, Beyond: Fortunately for Naked investors, the stock got caught in the middle of a massive coordinated buying campaign in January 2021. Reddit’s WallStreetBets community made Naked one of its primary stocks to buy as part of its targeted short squeeze effort.

The short squeeze sent the stock skyrocketing from under 40 cents per share to as high as $3.40 in a matter of days. Since the dust settled on the January short squeeze, Naked shares dropped back down to under 50 cents before a second squeeze in June sent them back up to $1.

Today, Naked is trading at 67 cents.

Naked investors who bought one year ago and held on through the squeezes are once again underwater on their investment. In fact, $1,000 in Naked stock bought on June 15, 2020 would be worth about $729 today.

Looking ahead, there’s no real reason to expect Naked Brand to deviate from its long-term history of shrinking sales, heavy losses and shareholder dilution. With the stock back under the minimum Nasdaq share price requirement of $1, another reverse stock split could also be just around the corner.