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The Ugar Sugar Works Limited (NSE:UGARSUGAR) shareholders should be happy to see the share price up 14% in the last month. But that cannot eclipse the less-than-impressive returns over the last three years. In fact, the share price is down 50% in the last three years, falling well short of the market return.
Check out our latest analysis for Ugar Sugar Works
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. 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).
Ugar Sugar Works became profitable within the last five years. That would generally be considered a positive, so we are surprised to see the share price is down. So it's worth looking at other metrics to try to understand the share price move.
Arguably the revenue decline of 6.1% per year has people thinking Ugar Sugar Works is shrinking. After all, if revenue keeps shrinking, it may be difficult to find earnings growth in the future.
The graphic below shows how revenue and earnings have changed as management guided the business forward. If you want to see cashflow, you can click on the chart.
If you are thinking of buying or selling Ugar Sugar Works stock, you should check out this FREE detailed report on its balance sheet.
A Different Perspective
Ugar Sugar Works shareholders are up 3.2% for the year. Unfortunately this falls short of the market return. The silver lining is that the gain was actually better than the average annual return of 1.1% per year over five year. It is possible that returns will improve along with the business fundamentals. Before forming an opinion on Ugar Sugar Works you might want to consider these 3 valuation metrics.
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Please note, the market returns quoted in this article reflect the market weighted average returns of stocks that currently trade on IN 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.