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These days it's easy to simply buy an index fund, and your returns should (roughly) match the market. But if you pick the right individual stocks, you could make more than that. For example, the KPJ Healthcare Berhad (KLSE:KPJ) share price is up 47% in the last 1 year, clearly besting the market return of around 3.7% (not including dividends). So that should have shareholders smiling. Looking back further, the stock price is 42% higher than it was three years ago.
Let's take a look at the underlying fundamentals over the longer term, and see if they've been consistent with shareholders returns.
View our latest analysis for KPJ Healthcare Berhad
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 last year KPJ Healthcare Berhad grew its earnings per share (EPS) by 113%. It's fair to say that the share price gain of 47% did not keep pace with the EPS growth. Therefore, it seems the market isn't as excited about KPJ Healthcare Berhad as it was before. This could be an opportunity.
The company's earnings per share (over time) is depicted in the image below (click to see the exact numbers).
We know that KPJ Healthcare Berhad has improved its bottom line lately, but is it going to grow revenue? Check if analysts think KPJ Healthcare Berhad will grow revenue in the future.
What About Dividends?
When looking at investment returns, it is important to consider the difference between total shareholder return (TSR) and share price return. 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. So for companies that pay a generous dividend, the TSR is often a lot higher than the share price return. As it happens, KPJ Healthcare Berhad's TSR for the last 1 year was 52%, 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 good to see that KPJ Healthcare Berhad has rewarded shareholders with a total shareholder return of 52% in the last twelve months. And that does include the dividend. That gain is better than the annual TSR over five years, which is 9%. Therefore it seems like sentiment around the company has been positive lately. In the best case scenario, this may hint at some real business momentum, implying that now could be a great time to delve deeper. It's always interesting to track share price performance over the longer term. But to understand KPJ Healthcare Berhad better, we need to consider many other factors. For instance, we've identified 2 warning signs for KPJ Healthcare Berhad (1 is a bit unpleasant) that you should be aware of.