These days it's easy to simply buy an index fund, and your returns should (roughly) match the market. But you can significantly boost your returns by picking above-average stocks. For example, the HSS Engineers Berhad (KLSE:HSSEB) share price is up 100% in the last 1 year, clearly besting the market return of around 19% (not including dividends). So that should have shareholders smiling. Also impressive, the stock is up 74% over three years, making long term shareholders happy, too.
Let's take a look at the underlying fundamentals over the longer term, and see if they've been consistent with shareholders returns.
See our latest analysis for HSS Engineers Berhad
There is no denying that markets are sometimes efficient, but prices do not always reflect underlying business performance. 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 last year HSS Engineers Berhad grew its earnings per share (EPS) by 35%. This EPS growth is significantly lower than the 100% increase in the share price. So it's fair to assume the market has a higher opinion of the business than it a year ago.
The company's earnings per share (over time) is depicted in the image below (click to see the exact numbers).
We know that HSS Engineers Berhad has improved its bottom line lately, but is it going to grow revenue? Check if analysts think HSS Engineers Berhad will grow revenue in the future.
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. Arguably, the TSR gives a more comprehensive picture of the return generated by a stock. In the case of HSS Engineers Berhad, it has a TSR of 103% for the last 1 year. That exceeds its share price return that we previously mentioned. This is largely a result of its dividend payments!
A Different Perspective
It's good to see that HSS Engineers Berhad has rewarded shareholders with a total shareholder return of 103% in the last twelve months. Of course, that includes the dividend. There's no doubt those recent returns are much better than the TSR loss of 0.6% per year over five years. This makes us a little wary, but the business might have turned around its fortunes. While it is well worth considering the different impacts that market conditions can have on the share price, there are other factors that are even more important. To that end, you should be aware of the 1 warning sign we've spotted with HSS Engineers Berhad .