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These days it's easy to simply buy an index fund, and your returns should (roughly) match the market. But even in a market-beating portfolio, some stocks will lag the market. While the Frasers Hospitality Trust (SGX:ACV) share price is down 18% over half a decade, the total return to shareholders (which includes dividends) was 20%. That's better than the market which returned 11% over the same time. The good news is that the stock is up 1.4% in the last week.
View our latest analysis for Frasers Hospitality Trust
To paraphrase Benjamin Graham: Over the short term the market is a voting machine, but over the long term it's a weighing machine. One way to examine how market sentiment has changed over time is to look at the interaction between a company's share price and its earnings per share (EPS).
During the five years over which the share price declined, Frasers Hospitality Trust's earnings per share (EPS) dropped by 6.4% each year. The share price decline of 3.8% per year isn't as bad as the EPS decline. So investors might expect EPS to bounce back -- or they may have previously foreseen the EPS decline.
The image below shows how EPS has tracked over time (if you click on the image you can see greater detail).
This free interactive report on Frasers Hospitality Trust's earnings, revenue and cash flow is a great place to start, if you want to investigate the stock further.
What About Dividends?
As well as measuring the share price return, investors should also consider the total shareholder return (TSR). The TSR incorporates the value of any spin-offs or discounted capital raisings, along with any dividends, based on the assumption that the dividends are reinvested. So for companies that pay a generous dividend, the TSR is often a lot higher than the share price return. As it happens, Frasers Hospitality Trust's TSR for the last 5 years was 20%, which exceeds the share price return mentioned earlier. The dividends paid by the company have thusly boosted the total shareholder return.
A Different Perspective
We're pleased to report that Frasers Hospitality Trust shareholders have received a total shareholder return of 11% over one year. That's including the dividend. That gain is better than the annual TSR over five years, which is 3.8%. Therefore it seems like sentiment around the company has been positive lately. Someone with an optimistic perspective could view the recent improvement in TSR as indicating that the business itself is getting better with time. Before forming an opinion on Frasers Hospitality Trust you might want to consider the cold hard cash it pays as a dividend. This free chart tracks its dividend over time.