Earnings growth outpaced the notable 21% CAGR delivered to Central Cooperative Bank AD (BUL:CCB) shareholders over the last three years

One simple way to benefit from the stock market is to buy an index fund. But many of us dare to dream of bigger returns, and build a portfolio ourselves. Just take a look at Central Cooperative Bank AD (BUL:CCB), which is up 78%, over three years, soundly beating the market return of 39% (not including dividends). On the other hand, the returns haven't been quite so good recently, with shareholders up just 19%.

The past week has proven to be lucrative for Central Cooperative Bank AD investors, so let's see if fundamentals drove the company's three-year performance.

View our latest analysis for Central Cooperative Bank AD

There is no denying that markets are sometimes efficient, but prices do not always reflect underlying business performance. One imperfect but simple way to consider how the market perception of a company has shifted is to compare the change in the earnings per share (EPS) with the share price movement.

During three years of share price growth, Central Cooperative Bank AD achieved compound earnings per share growth of 103% per year. The average annual share price increase of 21% is actually lower than the EPS growth. So one could reasonably conclude that the market has cooled on the stock. This cautious sentiment is reflected in its (fairly low) P/E ratio of 2.46.

The image below shows how EPS has tracked over time (if you click on the image you can see greater detail).

Dive deeper into Central Cooperative Bank AD's key metrics by checking this interactive graph of Central Cooperative Bank AD's earnings, revenue and cash flow.

A Different Perspective

Central Cooperative Bank AD provided a TSR of 19% over the last twelve months. But that was short of the market average. The silver lining is that the gain was actually better than the average annual return of 2% per year over five year. This suggests the company might be improving over time. You could get a better understanding of Central Cooperative Bank AD's growth by checking out this more detailed historical graph of earnings, revenue and cash flow.

If you would prefer to check out another company -- one with potentially superior financials -- then do not miss this free list of companies that have proven they can grow earnings.

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