What Type Of Returns Would Tata Teleservices (Maharashtra)'s(NSE:TTML) Shareholders Have Earned If They Purchased Their SharesThree Years Ago?

While it may not be enough for some shareholders, we think it is good to see the Tata Teleservices (Maharashtra) Limited (NSE:TTML) share price up 25% in a single quarter. But that cannot eclipse the less-than-impressive returns over the last three years. After all, the share price is down 49% in the last three years, significantly under-performing the market.

See our latest analysis for Tata Teleservices (Maharashtra)

Tata Teleservices (Maharashtra) isn't currently profitable, so most analysts would look to revenue growth to get an idea of how fast the underlying business is growing. Shareholders of unprofitable companies usually expect strong revenue growth. As you can imagine, fast revenue growth, when maintained, often leads to fast profit growth.

In the last three years Tata Teleservices (Maharashtra) saw its revenue shrink by 31% per year. That means its revenue trend is very weak compared to other loss making companies. On the face of it we'd posit the share price fall of 14% compound, over three years is well justified by the fundamental deterioration. It would probably be worth asking whether the company can fund itself to profitability. Of course, it is possible for businesses to bounce back from a revenue drop - but we'd want to see that before getting interested.

The company's revenue and earnings (over time) are depicted in the image below (click to see the exact numbers).

This free interactive report on Tata Teleservices (Maharashtra)'s balance sheet strength is a great place to start, if you want to investigate the stock further.

A Different Perspective

It's good to see that Tata Teleservices (Maharashtra) has rewarded shareholders with a total shareholder return of 48% in the last twelve months. There's no doubt those recent returns are much better than the TSR loss of 7.9% per year over five years. We generally put more weight on the long term performance over the short term, but the recent improvement could hint at a (positive) inflection point within the business. 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. Take risks, for example - Tata Teleservices (Maharashtra) has 3 warning signs (and 1 which is a bit unpleasant) we think you should know about.

If you are like me, then you will not want to miss this free list of growing companies that insiders are buying.

Please note, the market returns quoted in this article reflect the market weighted average returns of stocks that currently trade on IN exchanges.

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This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
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