Investors ignore increasing losses at Tredegar (NYSE:TG) as stock jumps 18% this past week

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 business to buy shares in, you can make more than you can lose. Take, for example Tredegar Corporation (NYSE:TG). Its share price is already up an impressive 100% in the last twelve months. It's also good to see the share price up 64% over the last quarter. Unfortunately the longer term returns are not so good, with the stock falling 29% in the last three years.

On the back of a solid 7-day performance, let's check what role the company's fundamentals have played in driving long term shareholder returns.

See our latest analysis for Tredegar

Tredegar 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. That's because it's hard to be confident a company will be sustainable if revenue growth is negligible, and it never makes a profit.

Tredegar actually shrunk its revenue over the last year, with a reduction of 12%. We're a little surprised to see the share price pop 100% in the last year. It just goes to show the market doesn't always pay attention to the reported numbers. Of course, it could be that the market expected this revenue drop.

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

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

A Different Perspective

It's nice to see that Tredegar shareholders have received a total shareholder return of 100% over the last year. Notably the five-year annualised TSR loss of 6% per year compares very unfavourably with the recent share price performance. 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. While it is well worth considering the different impacts that market conditions can have on the share price, there are other factors that are even more important. Case in point: We've spotted 2 warning signs for Tredegar you should be aware of.

Of course Tredegar 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 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.