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Security and Intelligence Services (India) Limited (NSE:SIS) shareholders should be happy to see the share price up 11% in the last month. But that doesn't change the reality of under-performance over the last twelve months. In fact, the price has declined 7.9% in a year, falling short of the returns you could get by investing in an index fund.
See our latest analysis for Security and Intelligence Services (India)
While markets are a powerful pricing mechanism, share prices reflect investor sentiment, not just 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.
During the unfortunate twelve months during which the Security and Intelligence Services (India) share price fell, it actually saw its earnings per share (EPS) improve by 39%. It could be that the share price was previously over-hyped. It's surprising to see the share price fall so much, despite the improved EPS. But we might find some different metrics explain the share price movements better.
Given the yield is quite low, at 0.4%, we doubt the dividend can shed much light on the share price. Security and Intelligence Services (India) managed to grow revenue over the last year, which is usually a real positive. Since we can't easily explain the share price movement based on these metrics, it might be worth considering how market sentiment has changed towards the stock.
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. It's always worth keeping an eye on CEO pay, but a more important question is whether the company will grow earnings throughout the years. If you are thinking of buying or selling Security and Intelligence Services (India) stock, you should check out this free report showing analyst profit forecasts.
A Different Perspective
We doubt Security and Intelligence Services (India) shareholders are happy with the loss of 7.6% over twelve months (even including dividends) . That falls short of the market, which lost 0.5%. There's no doubt that's a disappointment, but the stock may well have fared better in a stronger market. With the stock down 5.6% over the last three months, the market doesn't seem to believe that the company has solved all its problems. Basically, most investors should be wary of buying into a poor-performing stock, unless the business itself has clearly improved. Before spending more time on Security and Intelligence Services (India) it might be wise to click here to see if insiders have been buying or selling shares.