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Minmetals Land Limited (HKG:230) shareholders might be concerned after seeing the share price drop 15% in the last month. But that doesn't change the fact that the returns over the last five years have been pleasing. After all, the share price is up a market-beating 47% in that time.
Check out our latest analysis for Minmetals Land
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 way to examine how market sentiment has changed over time is to look at the interaction between a company's share price and its earnings per share (EPS).
During five years of share price growth, Minmetals Land achieved compound earnings per share (EPS) growth of 14% per year. This EPS growth is higher than the 8.0% average annual increase in the share price. Therefore, it seems the market has become relatively pessimistic about the company. This cautious sentiment is reflected in its (fairly low) P/E ratio of 4.47.
The graphic below depicts how EPS has changed over time (unveil the exact values by clicking on the image).
Dive deeper into Minmetals Land's key metrics by checking this interactive graph of Minmetals Land's earnings, revenue and cash flow.
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. Arguably, the TSR gives a more comprehensive picture of the return generated by a stock. In the case of Minmetals Land, it has a TSR of 76% for the last 5 years. That exceeds its share price return that we previously mentioned. And there's no prize for guessing that the dividend payments largely explain the divergence!
A Different Perspective
Although it hurts that Minmetals Land returned a loss of 9.7% in the last twelve months, the broader market was actually worse, returning a loss of 16%. Of course, the long term returns are far more important and the good news is that over five years, the stock has returned 12% for each year. In the best case scenario the last year is just a temporary blip on the journey to a brighter future. If you would like to research Minmetals Land in more detail then you might want to take a look at whether insiders have been buying or selling shares in the company.