Ideally, your overall portfolio should beat the market average. A talented investor can beat the market with a diversified portfolio, but even then, some stocks will under-perform. While the Manufacturing Integration Technology Ltd (SGX:M11) share price is down 65% over half a decade, the total return to shareholders (which includes dividends) was 48%. That’s better than the market which declined 15% over the same time. But it’s up 6.6% in the last week.
See our latest analysis for Manufacturing Integration Technology
Given that Manufacturing Integration Technology 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 it’s hard to be confident a company will be sustainable if revenue growth is negligible, and it never makes a profit.
Over half a decade Manufacturing Integration Technology reduced its trailing twelve month revenue by 41% for each year. That’s definitely a weaker result than most pre-profit companies report. Arguably, the market has responded appropriately to this business performance by sending the share price down 19% (annualized) in the same time period. We don’t generally like to own companies that lose money and don’t grow revenues. You might be better off spending your money on a leisure activity. This looks like a really risky stock to buy, at a glance.
You can see how earnings and revenue have changed over time in the image below (click on the chart to see the exact values).
It’s probably worth noting that the CEO is paid less than the median at similar sized companies. But while CEO remuneration is always worth checking, the really important question is whether the company can grow earnings going forward. Dive deeper into the earnings by checking this interactive graph of Manufacturing Integration Technology’s earnings, revenue and cash flow.
What about the Total Shareholder Return (TSR)?
We’ve already covered Manufacturing Integration Technology’s share price action, but we should also mention its total shareholder return (TSR). The TSR attempts to capture the value of dividends (as if they were reinvested) as well as any spin-offs or discounted capital raisings offered to shareholders. Dividends have been really beneficial for Manufacturing Integration Technology shareholders, and that cash payout contributed to why its TSR of 48%, over the last 5 years, is better than the share price return.
A Different Perspective
While it’s never nice to take a loss, Manufacturing Integration Technology shareholders can take comfort that their trailing twelve month loss of 15% wasn’t as bad as the market loss of around 21%. Of course, the long term returns are far more important and the good news is that over five years, the stock has returned 8.2% for each year. In the best case scenario the last year is just a temporary blip on the journey to a brighter future. 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. Even so, be aware that Manufacturing Integration Technology is showing 3 warning signs in our investment analysis , and 1 of those is a bit concerning…
We will like Manufacturing Integration Technology 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 SG exchanges.
If you spot an error that warrants correction, please contact the editor at [email protected] 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.
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