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The simplest way to benefit from a rising market is to buy an index fund. But if you buy individual stocks, you can do both better or worse than that. For example, the Ctac N.V. (AMS:CTAC) share price is down 40% in the last year. That falls noticeably short of the market return of around 6.3%. Even if you look out three years, the returns are still disappointing, with the share price down (the share price is down 39%) in that time. Furthermore, it's down 33% in about a quarter. That's not much fun for holders.
Check out our latest analysis for Ctac
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.
Unfortunately Ctac reported an EPS drop of 72% for the last year. The share price fall of 40% isn't as bad as the reduction in earnings per share. So despite the weak per-share profits, some investors are probably relieved the situation wasn't more difficult.
The graphic below depicts how EPS has changed over time (unveil the exact values by clicking on the image).
Dive deeper into Ctac's key metrics by checking this interactive graph of Ctac's earnings, revenue and cash flow.
What about the Total Shareholder Return (TSR)?
We've already covered Ctac's share price action, but we should also mention its total shareholder return (TSR). The TSR is a return calculation that accounts for the value of cash dividends (assuming that any dividend received was reinvested) and the calculated value of any discounted capital raisings and spin-offs. Its history of dividend payouts mean that Ctac's TSR, which was a 38% drop over the last year, was not as bad as the share price return.
A Different Perspective
While the broader market gained around 6.3% in the last year, Ctac shareholders lost 38% (even including dividends) . However, keep in mind that even the best stocks will sometimes underperform the market over a twelve month period. On the bright side, long term shareholders have made money, with a gain of 2.5% per year over half a decade. If the fundamental data continues to indicate long term sustainable growth, the current sell-off could be an opportunity worth considering. Before forming an opinion on Ctac you might want to consider the cold hard cash it pays as a dividend. This free chart tracks its dividend over time.
Of course Ctac may not be the best stock to buy. So you may wish to see this free collection of growth stocks.