Ideally, your overall portfolio should beat the market average. But the main game is to find enough winners to more than offset the losers At this point some shareholders may be questioning their investment in Oriental Press Group Limited (HKG:18), since the last five years saw the share price fall 33%. And some of the more recent buyers are probably worried, too, with the stock falling 29% in the last year. The good news is that the stock is up 3.6% in the last week.
See our latest analysis for Oriental Press Group
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 the five years over which the share price declined, Oriental Press Group's earnings per share (EPS) dropped by 1.7% each year. This reduction in EPS is less than the 7.8% annual reduction in the share price. This implies that the market was previously too optimistic about the stock.
The graphic below depicts how EPS has changed over time (unveil the exact values by clicking on the image).
It might be well worthwhile taking a look at our free report on Oriental Press Group's earnings, revenue and cash flow.
What about the Total Shareholder Return (TSR)?
We'd be remiss not to mention the difference between Oriental Press Group's total shareholder return (TSR) and its share price return. 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. Dividends have been really beneficial for Oriental Press Group shareholders, and that cash payout contributed to why its TSR of 18%, over the last 5 years, is better than the share price return.
A Different Perspective
Investors in Oriental Press Group had a tough year, with a total loss of 27%, against a market gain of about 11%. 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. On the bright side, long term shareholders have made money, with a gain of 3.4% per year over half a decade. It could be that the recent sell-off is an opportunity, so it may be worth checking the fundamental data for signs of a long term growth trend. Is Oriental Press Group cheap compared to other companies? These 3 valuation measures might help you decide.