The past three-year earnings decline for Hily Holding PJSC (ADX:HH) likely explains shareholders long-term losses

While not a mind-blowing move, it is good to see that the Hily Holding PJSC (ADX:HH) share price has gained 26% in the last three months. But that doesn't help the fact that the three year return is less impressive. After all, the share price is down 10% in the last three years, significantly under-performing the market.

While the last three years has been tough for Hily Holding PJSC shareholders, this past week has shown signs of promise. So let's look at the longer term fundamentals and see if they've been the driver of the negative returns.

See our latest analysis for Hily Holding PJSC

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.

Hily Holding PJSC saw its EPS decline at a compound rate of 55% per year, over the last three years. This fall in the EPS is worse than the 4% compound annual share price fall. This suggests that the market retains some optimism around long term earnings stability, despite past EPS declines.

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

Dive deeper into Hily Holding PJSC's key metrics by checking this interactive graph of Hily Holding PJSC's earnings, revenue and cash flow.

A Different Perspective

Hily Holding PJSC shareholders are down 1.3% for the year, but the market itself is up 5.7%. However, keep in mind that even the best stocks will sometimes underperform the market over a twelve month period. Unfortunately, longer term shareholders are suffering worse, given the loss of 1.7% doled out over the last five years. We'd need to see some sustained improvements in the key metrics before we could muster much enthusiasm. While it is well worth considering the different impacts that market conditions can have on the share price, there are other factors that are even more important. Take risks, for example - Hily Holding PJSC has 3 warning signs we think you should be aware of.

For those who like to find winning investments this free list of undervalued companies with recent insider purchasing, could be just the ticket.

Please note, the market returns quoted in this article reflect the market weighted average returns of stocks that currently trade on Emirian exchanges.

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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.