TAL Education Group (NYSE:TAL shareholders incur further losses as stock declines 8.2% this week, taking three-year losses to 86%
As an investor, mistakes are inevitable. But really bad investments should be rare. So spare a thought for the long term shareholders of TAL Education Group (NYSE:TAL); the share price is down a whopping 86% in the last three years. That would be a disturbing experience. The last week also saw the share price slip down another 8.2%. We really hope anyone holding through that price crash has a diversified portfolio. Even when you lose money, you don't have to lose the lesson.
After losing 8.2% this past week, it's worth investigating the company's fundamentals to see what we can infer from past performance.
See our latest analysis for TAL Education Group
There is no denying that markets are sometimes efficient, but prices do not always reflect underlying business performance. 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.
TAL Education Group has made a profit in the past. However, it made a loss in the last twelve months, suggesting profit may be an unreliable metric at this stage. Other metrics might give us a better handle on how its value is changing over time.
We think that the revenue decline over three years, at a rate of 43% per year, probably had some shareholders looking to sell. After all, if revenue keeps shrinking, it may be difficult to find earnings growth in the future.
You can see below how earnings and revenue have changed over time (discover the exact values by clicking on the image).
TAL Education Group is well known by investors, and plenty of clever analysts have tried to predict the future profit levels. If you are thinking of buying or selling TAL Education Group stock, you should check out this free report showing analyst consensus estimates for future profits.
A Different Perspective
It's good to see that TAL Education Group has rewarded shareholders with a total shareholder return of 41% in the last twelve months. There's no doubt those recent returns are much better than the TSR loss of 10% per year over five years. The long term loss makes us cautious, but the short term TSR gain certainly hints at a brighter future. You could get a better understanding of TAL Education Group's growth by checking out this more detailed historical graph of earnings, revenue and cash flow.
Of course TAL Education Group 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.
