Would Shareholders Who Purchased Property and Building's (TLV:PTBL) Stock Year Be Happy With The Share price Today?

Investors can approximate the average market return by buying an index fund. But if you buy individual stocks, you can do both better or worse than that. Investors in Property and Building Corp. Ltd (TLV:PTBL) have tasted that bitter downside in the last year, as the share price dropped 18%. That's well below the market return of 4.1%. However, the longer term returns haven't been so bad, with the stock down 6.8% in the last three years.

See our latest analysis for Property and Building

Property and Building isn't currently profitable, so most analysts would look to revenue growth to get an idea of how fast the underlying business is growing. Generally speaking, companies without profits are expected to grow revenue every year, and at a good clip. Some companies are willing to postpone profitability to grow revenue faster, but in that case one does expect good top-line growth.

In just one year Property and Building saw its revenue fall by 1.7%. That's not what investors generally want to see. Shareholders have seen the share price drop 18% in that time. What would you expect when revenue is falling, and it doesn't make a profit? We think most holders must believe revenue growth will improve, or else costs will decline.

You can see below how earnings and revenue have changed over time (discover the exact values by clicking on the image).

This free interactive report on Property and Building's balance sheet strength is a great place to start, if you want to investigate the stock further.

What About Dividends?

As well as measuring the share price return, investors should also consider the total shareholder return (TSR). Whereas the share price return only reflects the change in the share price, the TSR includes the value of dividends (assuming they were reinvested) and the benefit of any discounted capital raising or spin-off. Arguably, the TSR gives a more comprehensive picture of the return generated by a stock. We note that for Property and Building the TSR over the last year was -13%, which is better than the share price return mentioned above. This is largely a result of its dividend payments!

A Different Perspective

Investors in Property and Building had a tough year, with a total loss of 13% (including dividends), against a market gain of about 4.1%. Even the share prices of good stocks drop sometimes, but we want to see improvements in the fundamental metrics of a business, before getting too interested. Longer term investors wouldn't be so upset, since they would have made 9%, each year, over five years. It could be that the recent sell-off is an opportunity, so it may be worth checking the fundamental data for signs of a long term growth trend. It's always interesting to track share price performance over the longer term. But to understand Property and Building better, we need to consider many other factors. Like risks, for instance. Every company has them, and we've spotted 2 warning signs for Property and Building (of which 1 is a bit unpleasant!) you should know about.

If you would prefer to check out another company -- one with potentially superior financials -- then do not miss this free list of companies that have proven they can grow earnings.

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