TravelCenters of America (NASDAQ:TA) delivers shareholders decent 24% CAGR over 3 years, surging 10% in the last week alone

Simply Wall St
March 15, 2022
Source: Shutterstock

TravelCenters of America Inc. (NASDAQ:TA) shareholders might be concerned after seeing the share price drop 21% in the last quarter. But don't let that distract from the very nice return generated over three years. To wit, the share price did better than an index fund, climbing 91% during that period.

Since it's been a strong week for TravelCenters of America shareholders, let's have a look at trend of the longer term fundamentals.

Check out our latest analysis for TravelCenters of America

While the efficient markets hypothesis continues to be taught by some, it has been proven that markets are over-reactive dynamic systems, and investors are not always rational. One flawed but reasonable way to assess how sentiment around a company has changed is to compare the earnings per share (EPS) with the share price.

During three years of share price growth, TravelCenters of America moved from a loss to profitability. That would generally be considered a positive, so we'd expect the share price to be up.

You can see how EPS has changed over time in the image below (click on the chart to see the exact values).

NasdaqGS:TA Earnings Per Share Growth March 15th 2022

We know that TravelCenters of America has improved its bottom line over the last three years, but what does the future have in store? This free interactive report on TravelCenters of America's balance sheet strength is a great place to start, if you want to investigate the stock further.

A Different Perspective

It's good to see that TravelCenters of America has rewarded shareholders with a total shareholder return of 44% in the last twelve months. That's better than the annualised return of 7% over half a decade, implying that the company is doing better recently. Someone with an optimistic perspective could view the recent improvement in TSR as indicating that the business itself is getting better with time. It's always interesting to track share price performance over the longer term. But to understand TravelCenters of America better, we need to consider many other factors. For example, we've discovered 2 warning signs for TravelCenters of America (1 is a bit unpleasant!) that you should be aware of before investing here.

We will like TravelCenters of America better if we see some big insider buys. While we wait, check out this free list of growing companies with considerable, recent, insider buying.

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

Discounted cash flow calculation for every stock

Simply Wall St does a detailed discounted cash flow calculation every 6 hours for every stock on the market, so if you want to find the intrinsic value of any company just search here. It’s FREE.

Make Confident Investment Decisions

Simply Wall St's Editorial Team provides unbiased, factual reporting on global stocks using in-depth fundamental analysis.
Find out more about our editorial guidelines and team.