MakeMyTrip (NASDAQ:MMYT) shareholder returns have been impressive, earning 186% in 1 year

The most you can lose on any stock (assuming you don't use leverage) is 100% of your money. But if you pick the right stock, you can make a lot more than 100%. For example, the MakeMyTrip Limited (NASDAQ:MMYT) share price has soared 186% return in just a single year. On top of that, the share price is up 48% in about a quarter. Looking back further, the stock price is 114% higher than it was three years ago.

Since the stock has added US$520m to its market cap in the past week alone, let's see if underlying performance has been driving long-term returns.

See our latest analysis for MakeMyTrip

Given that MakeMyTrip only made minimal earnings in the last twelve months, we'll focus on revenue to gauge its business development. As a general rule, we think this kind of company is more comparable to loss-making stocks, since the actual profit is so low. For shareholders to have confidence a company will grow profits significantly, it must grow revenue.

MakeMyTrip grew its revenue by 37% last year. That's a fairly respectable growth rate. While that revenue growth is pretty good the share price performance outshone it, with a lift of 186% as mentioned above. If the profitability is on the horizon then now could be a very exciting time to be a shareholder. But investors need to be wary of how the 'fear of missing out' could influence them to buy without doing thorough research.

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

It is of course excellent to see how MakeMyTrip has grown profits over the years, but the future is more important for shareholders. If you are thinking of buying or selling MakeMyTrip stock, you should check out this FREE detailed report on its balance sheet.

A Different Perspective

It's nice to see that MakeMyTrip shareholders have received a total shareholder return of 186% over the last year. That gain is better than the annual TSR over five years, which is 20%. Therefore it seems like sentiment around the company has been positive lately. Given the share price momentum remains strong, it might be worth taking a closer look at the stock, lest you miss an opportunity. It's always interesting to track share price performance over the longer term. But to understand MakeMyTrip better, we need to consider many other factors. Even so, be aware that MakeMyTrip is showing 1 warning sign in our investment analysis , you should know about...

If you like to buy stocks alongside management, then you might just love this free list of companies. (Hint: insiders have been buying them).

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