Yahoo Finance Introducing Stride Stapled Group (NZSE:SPG), A Stock That Climbed 21% In The Last Year
If you want to compound wealth in the stock market, you can do so by buying an index fund. But you can significantly boost your returns by picking above-average stocks. For example, the Stride Stapled Group (NZSE:SPG) share price is up 21% in the last year, clearly besting than the market return of around 5.0% (not including dividends). If it can keep that out-performance up over the long term, investors will do very well! Note that businesses generally develop over the long term, so it the returns over the last year might not reflect a long term trend.
See our latest analysis for Stride Stapled Group
While markets are a powerful pricing mechanism, share prices reflect investor sentiment, not just underlying business performance. 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.
During the last year Stride Stapled Group grew its earnings per share (EPS) by 61%. This EPS growth is significantly higher than the 21% increase in the share price. So it seems like the market has cooled on Stride Stapled Group, despite the growth. Interesting. The caution is also evident in the lowish P/E ratio of 7.29.
The company’s earnings per share (over time) is depicted in the image below (click to see the exact numbers).
We know that Stride Stapled Group has improved its bottom line lately, but is it going to grow revenue? This free report showing analyst revenue forecasts should help you figure out if the EPS growth can be sustained.
What About Dividends?
It is important to consider the total shareholder return, as well as the share price return, for any given stock. Whereas the share price return only reflects the change in the share price, the TSR includes the value of dividends (assuming they were reinvested) and the benefit of any discounted capital raising. So for companies that pay a generous dividend, the TSR is often a lot higher than the share price return. As it happens, Stride Stapled Group’s TSR for the last year was 27%, which exceeds the share price return mentioned earlier. The dividends paid by the company have thusly boosted the total shareholder return.
A Different Perspective
It’s nice to see that Stride Stapled Group shareholders have gained 27% over the last year, including dividends. And the share price momentum remains respectable, with a gain of 9.7% in the last three months. Demand for the stock from multiple parties is pushing the price higher; it could be that word is getting out about its virtues as a business. Keeping this in mind, a solid next step might be to take a look at Stride Stapled Group’s dividend track record. This free interactive graph is a great place to start.
If you like to buy stocks alongside management, then you might just love this free list of companies. (Hint: insiders have been buying them).
Please note, the market returns quoted in this article reflect the market weighted average returns of stocks that currently trade on NZ exchanges.
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.
If you spot an error that warrants correction, please contact the editor at editorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading.
