New Zealand markets close in 4 hours 58 minutes
  • NZX 50

    12,095.28
    +4.35 (+0.04%)
     
  • NZD/USD

    0.6506
    +0.0073 (+1.14%)
     
  • NZD/EUR

    0.5911
    +0.0000 (+0.00%)
     
  • ALL ORDS

    7,709.70
    +23.60 (+0.31%)
     
  • ASX 200

    7,501.70
    +25.00 (+0.33%)
     
  • OIL

    76.70
    +0.29 (+0.38%)
     
  • GOLD

    1,966.80
    +21.50 (+1.11%)
     
  • NASDAQ

    12,363.10
    +261.17 (+2.16%)
     
  • FTSE

    7,761.11
    -10.59 (-0.14%)
     
  • Dow Jones

    34,092.96
    +6.92 (+0.02%)
     
  • DAX

    15,180.74
    +52.47 (+0.35%)
     
  • Hang Seng

    22,072.18
    +229.85 (+1.05%)
     
  • NIKKEI 225

    27,346.88
    +19.77 (+0.07%)
     
  • NZD/JPY

    83.7470
    +0.1250 (+0.15%)
     

The past five years for APG|SGA (VTX:APGN) investors has not been profitable

We think intelligent long term investing is the way to go. But unfortunately, some companies simply don't succeed. For example, after five long years the APG|SGA SA (VTX:APGN) share price is a whole 68% lower. We certainly feel for shareholders who bought near the top. Furthermore, it's down 19% in about a quarter. That's not much fun for holders.

So let's have a look and see if the longer term performance of the company has been in line with the underlying business' progress.

View our latest analysis for APG|SGA

To quote Buffett, 'Ships will sail around the world but the Flat Earth Society will flourish. There will continue to be wide discrepancies between price and value in the marketplace...' 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 five years over which the share price declined, APG|SGA's earnings per share (EPS) dropped by 16% each year. Readers should note that the share price has fallen faster than the EPS, at a rate of 20% per year, over the period. So it seems the market was too confident about the business, in the past.

You can see how EPS has changed over time in the image below (click on the chart to see the exact values).

earnings-per-share-growth
earnings-per-share-growth

We know that APG|SGA 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. 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. It's fair to say that the TSR gives a more complete picture for stocks that pay a dividend. In the case of APG|SGA, it has a TSR of -61% for the last 5 years. That exceeds its share price return that we previously mentioned. This is largely a result of its dividend payments!

A Different Perspective

We regret to report that APG|SGA shareholders are down 15% for the year (even including dividends). Unfortunately, that's worse than the broader market decline of 9.8%. Having said that, it's inevitable that some stocks will be oversold in a falling market. The key is to keep your eyes on the fundamental developments. However, the loss over the last year isn't as bad as the 10% per annum loss investors have suffered over the last half decade. We would want clear information suggesting the company will grow, before taking the view that the share price will stabilize. It's always interesting to track share price performance over the longer term. But to understand APG|SGA better, we need to consider many other factors. For example, we've discovered 3 warning signs for APG|SGA (2 are concerning!) that you should be aware of before investing here.

We will like APG|SGA 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 CH exchanges.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.

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.

Join A Paid User Research Session
You’ll receive a US$30 Amazon Gift card for 1 hour of your time while helping us build better investing tools for the individual investors like yourself. Sign up here