Yahoo Finance Earnings growth of 4.4% over 1 year hasn't been enough to translate into positive returns for WNS (Holdings) (NYSE:WNS) shareholders
The nature of investing is that you win some, and you lose some. Anyone who held WNS (Holdings) Limited (NYSE:WNS) over the last year knows what a loser feels like. The share price is down a hefty 53% in that time. We note that it has not been easy for shareholders over three years, either; the share price is down 41% in that time. The falls have accelerated recently, with the share price down 40% in the last three months. We note that the company has reported results fairly recently; and the market is hardly delighted. You can check out the latest numbers in our company report.
After losing 14% this past week, it's worth investigating the company's fundamentals to see what we can infer from past performance.
View our latest analysis for WNS (Holdings)
While the efficient markets hypothesis continues to be taught by some, it has been proven that markets are over-reactive dynamic systems, and investors are not always rational. 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.
During the unfortunate twelve months during which the WNS (Holdings) share price fell, it actually saw its earnings per share (EPS) improve by 4.4%. It's quite possible that growth expectations may have been unreasonable in the past.
It seems quite likely that the market was expecting higher growth from the stock. But other metrics might shed some light on why the share price is down.
WNS (Holdings)'s revenue is actually up 8.1% over the last year. Since we can't easily explain the share price movement based on these metrics, it might be worth considering how market sentiment has changed towards the stock.
You can see how earnings and revenue have changed over time in the image below (click on the chart to see the exact values).
We're pleased to report that the CEO is remunerated more modestly than most CEOs at similarly capitalized companies. But while CEO remuneration is always worth checking, the really important question is whether the company can grow earnings going forward. So we recommend checking out this free report showing consensus forecasts
A Different Perspective
While the broader market gained around 24% in the last year, WNS (Holdings) shareholders lost 53%. 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. Regrettably, last year's performance caps off a bad run, with the shareholders facing a total loss of 4% per year over five years. Generally speaking long term share price weakness can be a bad sign, though contrarian investors might want to research the stock in hope of a turnaround. Before deciding if you like the current share price, check how WNS (Holdings) scores on these 3 valuation metrics.
We will like WNS (Holdings) better if we see some big insider buys. While we wait, check out this free list of growing companies with considerable, recent, insider buying.
Please note, the market returns quoted in this article reflect the market weighted average returns of stocks that currently trade on American exchanges.
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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
