Does APN Convenience Retail REIT's (ASX:AQR) Share Price Gain of 10% Match Its Business Performance?

If you want to compound wealth in the stock market, you can do so by buying an index fund. But investors can boost returns by picking market-beating companies to own shares in. For example, the APN Convenience Retail REIT (ASX:AQR) share price is up 10% in the last year, clearly besting than the market return of around 5.3% (not including dividends). If it can keep that out-performance up over the long term, investors will do very well! APN Convenience Retail REIT hasn't been listed for long, so it's still not clear if it is a long term winner.

See our latest analysis for APN Convenience Retail REIT

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 APN Convenience Retail REIT saw its earnings per share (EPS) increase strongly. We don't think the exact number is a good guide to the sustainable growth rate, but we do think this sort of increase is impressive. So we're unsurprised to see the share price gaining ground. Strong growth like this can be evidence of a fundamental inflection point in the business, making it a good time to investigate the stock more closely.

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

We know that APN Convenience Retail REIT has improved its bottom line lately, but is it going to grow revenue? This freereport showing analyst revenue forecasts should help you figure out if the EPS growth can be sustained.

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 incorporates the value of any discounted capital raisings, along with any dividends, based on the assumption that the dividends are reinvested. Arguably, the TSR gives a more comprehensive picture of the return generated by a stock. As it happens, APN Convenience Retail REIT's TSR for the last year was 19%, which exceeds the share price return mentioned earlier. This is largely a result of its dividend payments!

A Different Perspective

APN Convenience Retail REIT boasts a total shareholder return of 19% for the last year(that includes the dividends). And the share price momentum remains respectable, with a gain of 7.9% in the last three months. Demand for the stock from multiple parties is pushing the price higher; it could be that word is getting out about its virtues as a business. If you would like to research APN Convenience Retail REIT in more detail then you might want to take a look at whether insiders have been buying or selling shares in the company.

If you like to buy stocks alongside management, then you might just love this freelist of companies. (Hint: insiders have been buying them).

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.