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Investing in stocks inevitably means buying into some companies that perform poorly. But long term Sam Woo Construction Group Limited (HKG:3822) shareholders have had a particularly rough ride in the last three year. So they might be feeling emotional about the 63% share price collapse, in that time. Furthermore, it's down 22% in about a quarter. That's not much fun for holders.
See our latest analysis for Sam Woo Construction Group
To quote Buffett, 'Ships will sail around the world but the Flat Earth Society will flourish. There will continue to be wide discrepancies between price and value in the marketplace...' 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).
Sam Woo Construction Group saw its share price decline over the three years in which its EPS also dropped, falling to a loss. Due to the loss, it's not easy to use EPS as a reliable guide to the business. However, we can say we'd expect to see a falling share price in this scenario.
You can see how EPS has changed over time in the image below (click on the chart to see the exact values).
It might be well worthwhile taking a look at our free report on Sam Woo Construction Group's earnings, revenue and cash flow.
What about the Total Shareholder Return (TSR)?
Investors should note that there's a difference between Sam Woo Construction Group's total shareholder return (TSR) and its share price change, which we've covered above. 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. Sam Woo Construction Group's TSR of was a loss of 61% for the 3 years. That wasn't as bad as its share price return, because it has paid dividends.
A Different Perspective
Sam Woo Construction Group shareholders are down 18% for the year, but the market itself is up 7.3%. Even the share prices of good stocks drop sometimes, but we want to see improvements in the fundamental metrics of a business, before getting too interested. Unfortunately, last year's performance may indicate unresolved challenges, given that it was worse than the annualised loss of 14% over the last half decade. Generally speaking long term share price weakness can be a bad sign, though contrarian investors might want to research the stock in hope of a turnaround. Shareholders might want to examine this detailed historical graph of past earnings, revenue and cash flow.