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Investors five-year losses continue as YTL Corporation Berhad (KLSE:YTL) dips a further 4.3% this week, earnings continue to decline
Statistically speaking, long term investing is a profitable endeavour. But no-one is immune from buying too high. For example the YTL Corporation Berhad (KLSE:YTL) share price dropped 62% over five years. We certainly feel for shareholders who bought near the top.
With the stock having lost 4.3% in the past week, it's worth taking a look at business performance and seeing if there's any red flags.
Check out our latest analysis for YTL Corporation Berhad
To paraphrase Benjamin Graham: Over the short term the market is a voting machine, but over the long term it's a weighing machine. One imperfect but simple way to consider how the market perception of a company has shifted is to compare the change in the earnings per share (EPS) with the share price movement.
YTL Corporation Berhad became profitable within the last five years. Most would consider that to be a good thing, so it's counter-intuitive to see the share price declining. Other metrics might give us a better handle on how its value is changing over time.
We note that the dividend has fallen in the last five years, so that may have contributed to the share price decline.
The graphic below depicts how earnings and revenue have changed over time (unveil the exact values by clicking on the image).
It is of course excellent to see how YTL Corporation Berhad has grown profits over the years, but the future is more important for shareholders. Take a more thorough look at YTL Corporation Berhad's financial health with this free report on its balance sheet.
What About Dividends?
As well as measuring the share price return, investors should also consider the total shareholder return (TSR). The TSR is a return calculation that accounts for the value of cash dividends (assuming that any dividend received was reinvested) and the calculated value of any discounted capital raisings and spin-offs. So for companies that pay a generous dividend, the TSR is often a lot higher than the share price return. We note that for YTL Corporation Berhad the TSR over the last 5 years was -55%, which is better than the share price return mentioned above. This is largely a result of its dividend payments!
A Different Perspective
It's nice to see that YTL Corporation Berhad shareholders have received a total shareholder return of 7.4% over the last year. That's including the dividend. Notably the five-year annualised TSR loss of 9% per year compares very unfavourably with the recent share price performance. The long term loss makes us cautious, but the short term TSR gain certainly hints at a brighter future. It's always interesting to track share price performance over the longer term. But to understand YTL Corporation Berhad better, we need to consider many other factors. For example, we've discovered 3 warning signs for YTL Corporation Berhad (2 are potentially serious!) that you should be aware of before investing here.
For those who like to find winning investments this free list of growing companies with recent insider purchasing, could be just the ticket.
Please note, the market returns quoted in this article reflect the market weighted average returns of stocks that currently trade on Malaysian exchanges.
Valuation is complex, but we're helping make it simple.
Find out whether YTL Corporation Berhad is potentially over or undervalued by checking out our comprehensive analysis, which includes fair value estimates, risks and warnings, dividends, insider transactions and financial health.View the Free Analysis
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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.
YTL Corporation Berhad
YTL Corporation Berhad, an investment holding company, operates as an integrated infrastructure developer.
Average dividend payer and fair value.