TAT Technologies Co., Ltd. (NASDAQ:TATT) stockholders should be happy that the stock rose 12% last month. But the stock has performed poorly over the past five years. In fact, the stock is down 41% for him, well short of the return you’d get from buying an index fund.
Shareholders are falling for the long term, so let’s look at the underlying fundamentals in the interim and see if they align with returns.
See the latest analysis from TAT Technologies
TAT Technologies has not been profitable for the past 12 months. A strong correlation between stock price and earnings per share (EPS) is unlikely. Revenue is almost certainly the next best option. Generally speaking, a non-profitable company is expected to grow steadily year after year. This is because rapid growth in revenue can often be easily guessed to predict profits of sizeable magnitude.
Over the past six months, TAT Technologies has seen its revenues decline by 7.1% each year over the past 12 months. That’s not what investors generally want to see. The stock has fallen 7% on an annualized basis over the past five years, and has not performed well for shareholders. Unfortunately, it makes sense given that neither profits nor revenues are growing. Without profits, it’s hard to see how shareholders will win if earnings continue to decline.
The image below shows how revenue and earnings were tracked over time (click image for more details).
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another point of view
Taking losses is never a good thing, but TAT Technologies shareholders can rest assured that the 1.2% loss over the past 12 months was not as bad as the market loss of about 7.7%. Far more concerning is the 7% annualized loss it has brought to shareholders over the past five years. This kind of price movement isn’t particularly encouraging, but at least the losses are narrowing. I find it very interesting to look at stock prices over the long term as an indicator of performance. But for true insight, other information must also be considered. Still, note what TAT Technologies indicates. 3 Warning Signs in Investment Analysis and two of them are related…
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Please note that the market returns quoted in this article reflect market-weighted average returns for stocks currently traded on US exchanges.
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This article by Simply Wall St is general in nature. We provide comments based on historical data and analyst projections using only unbiased methodologies and our articles are not intended as financial advice. It is not a recommendation to buy or sell stocks and does not take into account your objectives or financial situation. We aim to deliver long-term focused analysis based on fundamental data. Please note that our analysis may not take into account the latest price-sensitive company announcements or qualitative materials. Is not …
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