Top Shelf International Holdings Ltd (ASX:TSI) shareholders should be happy to see the share price up 15% in the last quarter. But that doesn't change the fact that the returns over the last year have been less than pleasing. In fact the stock is down 26% in the last year, well below the market return.

It's worthwhile assessing if the company's economics have been moving in lockstep with these underwhelming shareholder returns, or if there is some disparity between the two. So let's do just that.

See our latest analysis for Top Shelf International Holdings

Given that Top Shelf International Holdings 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. Some companies are willing to postpone profitability to grow revenue faster, but in that case one does expect good top-line growth.

In the last twelve months, Top Shelf International Holdings increased its revenue by 13%. While that may seem decent it isn't great considering the company is still making a loss. Given this lacklustre revenue growth, the share price drop of 26% seems pretty appropriate. It's important not to lose sight of the fact that profitless companies must grow. So remember, if you buy a profitless company then you risk being a profitless investor.

The company's revenue and earnings (over time) are depicted in the image below (click to see the exact numbers).

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

A Different Perspective

Top Shelf International Holdings shareholders are down 26% for the year, even worse than the market loss of 6.2%. There's no doubt that's a disappointment, but the stock may well have fared better in a stronger market. It's great to see a nice little 15% rebound in the last three months. This could just be a bounce because the selling was too aggressive, but fingers crossed it's the start of a new trend. It's always interesting to track share price performance over the longer term. But to understand Top Shelf International Holdings better, we need to consider many other factors. Consider for instance, the ever-present spectre of investment risk. We've identified 4 warning signs with Top Shelf International Holdings (at least 1 which is potentially serious) , and understanding them should be part of your investment process.

If you are like me, then you will not want to miss this free list of growing companies that insiders are buying.