As every investor would know, not every swing hits the sweet spot. But really bad investments should be rare. So spare a thought for the long term shareholders of Tele Columbus AG (ETR:TC1); the share price is down a whopping 79% in the last three years. That would certainly shake our confidence in the decision to own the stock. And the ride hasn't got any smoother in recent times over the last year, with the price 38% lower in that time. Furthermore, it's down 17% in about a quarter. That's not much fun for holders.
Given that Tele Columbus didn't make a profit in the last twelve months, we'll focus on revenue growth to form a quick view of its business development. Shareholders of unprofitable companies usually expect strong revenue growth. That's because fast revenue growth can be easily extrapolated to forecast profits, often of considerable size.
In the last three years, Tele Columbus saw its revenue grow by 4.0% per year, compound. That's not a very high growth rate considering it doesn't make profits. But the share price crash at 40% per year does seem a bit harsh! We generally don't try to 'catch the falling knife'. Before considering a purchase, take a look at the losses the company is racking up.
The image below shows how earnings and revenue have tracked over time (if you click on the image you can see greater detail).
This free interactive report on Tele Columbus's balance sheet strength is a great place to start, if you want to investigate the stock further.
A Different Perspective
The last twelve months weren't great for Tele Columbus shares, which performed worse than the market, costing holders 38%. The market shed around 3.7%, no doubt weighing on the stock price. However, the loss over the last year isn't as bad as the 40% per annum loss investors have suffered over the last three years. We'd need clear signs of growth in the underlying business before we could muster much enthusiasm for this one. Shareholders might want to examine this detailed historical graph of past earnings, revenue and cash flow.
Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of companies we expect will grow earnings.
Please note, the market returns quoted in this article reflect the market weighted average returns of stocks that currently trade on DE exchanges.
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If you spot an error that warrants correction, please contact the editor at email@example.com. 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. Simply Wall St has no position in the stocks mentioned. Thank you for reading.