We think that it's fair to say that the possibility of finding fantastic multi-year winners is what motivates many investors. You won't get it right every time, but when you do, the returns can be truly splendid. Take, for example, the Signature International Berhad (KLSE:SIGN) share price, which skyrocketed 644% over three years. It's also up 15% in about a month. It really delights us to see such great share price performance for investors.
The past week has proven to be lucrative for Signature International Berhad investors, so let's see if fundamentals drove the company's three-year performance.
View our latest analysis for Signature International 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 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.
Signature International Berhad was able to grow its EPS at 237% per year over three years, sending the share price higher. This EPS growth is higher than the 95% average annual increase in the share price. So it seems investors have become more cautious about the company, over time.
The image below shows how EPS has tracked over time (if you click on the image you can see greater detail).
Dive deeper into Signature International Berhad's key metrics by checking this interactive graph of Signature International Berhad's earnings, revenue and cash flow.
A Different Perspective
It's nice to see that Signature International Berhad shareholders have received a total shareholder return of 97% over the last year. Since the one-year TSR is better than the five-year TSR (the latter coming in at 38% per year), it would seem that the stock's performance has improved in recent times. Given the share price momentum remains strong, it might be worth taking a closer look at the stock, lest you miss an opportunity. It's always interesting to track share price performance over the longer term. But to understand Signature International Berhad better, we need to consider many other factors. For example, we've discovered 3 warning signs for Signature International Berhad (2 are significant!) that you should be aware of before investing here.
For those who like to find winning investments this free list of growing companies with recent insider purchasing, could be just the ticket.
Please note, the market returns quoted in this article reflect the market weighted average returns of stocks that currently trade on Malaysian exchanges.