Mitchells & Butlers (LON:MAB) shareholder returns have been decent, earning 41% in 1 year

These days it's easy to simply buy an index fund, and your returns should (roughly) match the market. But one can do better than that by picking better than average stocks (as part of a diversified portfolio). For example, the Mitchells & Butlers plc (LON:MAB) share price is up 41% in the last 1 year, clearly besting the market return of around 7.7% (not including dividends). That's a solid performance by our standards! In contrast, the longer term returns are negative, since the share price is 8.6% lower than it was three years ago.

The past week has proven to be lucrative for Mitchells & Butlers investors, so let's see if fundamentals drove the company's one-year performance.

Check out our latest analysis for Mitchells & Butlers

Mitchells & Butlers isn't currently profitable, so most analysts would look to revenue growth to get an idea of how fast the underlying business is growing. When a company doesn't make profits, we'd generally hope to see good revenue growth. As you can imagine, fast revenue growth, when maintained, often leads to fast profit growth.

In the last year Mitchells & Butlers saw its revenue grow by 13%. That's not great considering the company is losing money. The modest growth is probably largely reflected in the share price, which is up 41%. That's not a standout result, but it is solid - much like the level of revenue growth. Given the market doesn't seem too excited about the stock, a closer look at the financial data could pay off, if you can find indications of a stronger growth trend in the future.

You can see how earnings and revenue have changed over time in the image below (click on the chart to see the exact values).

Mitchells & Butlers is well known by investors, and plenty of clever analysts have tried to predict the future profit levels. You can see what analysts are predicting for Mitchells & Butlers in this interactive graph of future profit estimates.

A Different Perspective

It's good to see that Mitchells & Butlers has rewarded shareholders with a total shareholder return of 41% in the last twelve months. Since the one-year TSR is better than the five-year TSR (the latter coming in at 3% per year), it would seem that the stock's performance has improved in recent times. In the best case scenario, this may hint at some real business momentum, implying that now could be a great time to delve deeper. It's always interesting to track share price performance over the longer term. But to understand Mitchells & Butlers better, we need to consider many other factors. Consider for instance, the ever-present spectre of investment risk. We've identified 1 warning sign with Mitchells & Butlers , and understanding them should be part of your investment process.

Of course Mitchells & Butlers may not be the best stock to buy. So you may wish to see this free collection of growth stocks.

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

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. 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.