How Much Did ClearView Wealth's(ASX:CVW) Shareholders Earn From Share Price Movements Over The Last Three Years?

ClearView Wealth Limited (ASX:CVW) shareholders will doubtless be very grateful to see the share price up 31% in the last quarter. But only the myopic could ignore the astounding decline over three years. The share price has sunk like a leaky ship, down 72% in that time. So it's about time shareholders saw some gains. But the more important question is whether the underlying business can justify a higher price still.

Check out our latest analysis for ClearView Wealth

While markets are a powerful pricing mechanism, share prices reflect investor sentiment, not just underlying business performance. 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.

ClearView Wealth saw its EPS decline at a compound rate of 1.8% per year, over the last three years. This reduction in EPS is slower than the 35% annual reduction in the share price. 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).

It might be well worthwhile taking a look at our free report on ClearView Wealth's earnings, revenue and cash flow.

A Different Perspective

While the broader market gained around 1.7% in the last year, ClearView Wealth shareholders lost 12%. However, keep in mind that even the best stocks will sometimes underperform the market over a twelve month period. However, the loss over the last year isn't as bad as the 8% per annum loss investors have suffered over the last half decade. We'd need to see some sustained improvements in the key metrics before we could muster much enthusiasm. It's always interesting to track share price performance over the longer term. But to understand ClearView Wealth better, we need to consider many other factors. Consider risks, for instance. Every company has them, and we've spotted 1 warning sign for ClearView Wealth you should know about.

But note: ClearView Wealth may not be the best stock to buy. So take a peek at this free list of interesting companies with past earnings growth (and further growth forecast).

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

When trading ClearView Wealth or any other investment, use the platform considered by many to be the Professional's Gateway to the Worlds Market, Interactive Brokers. You get the lowest-cost* trading on stocks, options, futures, forex, bonds and funds worldwide from a single integrated account. Promoted

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. 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.
^*Interactive Brokers Rated Lowest Cost Broker by StockBrokers.com Annual Online Review 2020

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