The simplest way to invest in stocks is to buy exchange traded funds. But you can significantly boost your returns by picking above-average stocks. To wit, the Land & General Berhad (KLSE:L&G) share price is 26% higher than it was a year ago, much better than the market return of around 5.2% (not including dividends) in the same period. If it can keep that out-performance up over the long term, investors will do very well! The longer term returns have not been as good, with the stock price only 20% higher than it was three years ago.
So let's assess the underlying fundamentals over the last 1 year and see if they've moved in lock-step with shareholder returns.
Check out our latest analysis for Land & General Berhad
While markets are a powerful pricing mechanism, share prices reflect investor sentiment, not just underlying business performance. By comparing earnings per share (EPS) and share price changes over time, we can get a feel for how investor attitudes to a company have morphed over time.
Land & General Berhad was able to grow EPS by 80% in the last twelve months. It's fair to say that the share price gain of 26% did not keep pace with the EPS growth. Therefore, it seems the market isn't as excited about Land & General Berhad as it was before. This could be an opportunity.
The graphic below depicts how EPS has changed over time (unveil the exact values by clicking on the image).
Dive deeper into Land & General Berhad's key metrics by checking this interactive graph of Land & General Berhad's earnings, revenue and cash flow.
What About Dividends?
As well as measuring the share price return, investors should also consider the 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. Arguably, the TSR gives a more comprehensive picture of the return generated by a stock. In the case of Land & General Berhad, it has a TSR of 32% for the last 1 year. That exceeds its share price return that we previously mentioned. And there's no prize for guessing that the dividend payments largely explain the divergence!
A Different Perspective
We're pleased to report that Land & General Berhad shareholders have received a total shareholder return of 32% over one year. That's including the dividend. Notably the five-year annualised TSR loss of 0.3% per year compares very unfavourably with the recent share price performance. We generally put more weight on the long term performance over the short term, but the recent improvement could hint at a (positive) inflection point within the business. It's always interesting to track share price performance over the longer term. But to understand Land & General Berhad better, we need to consider many other factors. Even so, be aware that Land & General Berhad is showing 4 warning signs in our investment analysis , and 1 of those is significant...