When you buy a stock there is always a possibility that it could drop 100%. But on the bright side, you can make far more than 100% on a really good stock. One great example is Kelington Group Berhad (KLSE:KGB) which saw its share price drive 268% higher over five years.

Now it's worth having a look at the company's fundamentals too, because that will help us determine if the long term shareholder return has matched the performance of the underlying business.

View our latest analysis for Kelington Group Berhad

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 imperfect but simple way to consider how the market perception of a company has shifted is to compare the change in the earnings per share (EPS) with the share price movement.

During five years of share price growth, Kelington Group Berhad achieved compound earnings per share (EPS) growth of 27% per year. So the EPS growth rate is rather close to the annualized share price gain of 30% per year. That suggests that the market sentiment around the company hasn't changed much over that time. In fact, the share price seems to largely reflect the EPS growth.

The company's earnings per share (over time) is depicted in the image below (click to see the exact numbers).

We know that Kelington Group Berhad has improved its bottom line over the last three years, but what does the future have in store? If you are thinking of buying or selling Kelington Group Berhad stock, you should check out this FREE detailed report on its balance sheet.

What About Dividends?

When looking at investment returns, it is important to consider the difference between total shareholder return (TSR) and share price return. 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. We note that for Kelington Group Berhad the TSR over the last 5 years was 296%, which is better than the share price return mentioned above. And there's no prize for guessing that the dividend payments largely explain the divergence!

A Different Perspective

We're pleased to report that Kelington Group Berhad shareholders have received a total shareholder return of 31% over one year. And that does include the dividend. However, that falls short of the 32% TSR per annum it has made for shareholders, each year, over five years. Before forming an opinion on Kelington Group Berhad you might want to consider these 3 valuation metrics.