While shareholders of Cyrela Brazil Realty Empreendimentos e Participações (BVMF:CYRE3) are in the black over 5 years, those who bought a week ago aren't so fortunate

It hasn't been the best quarter for Cyrela Brazil Realty S.A. Empreendimentos e Participações (BVMF:CYRE3) shareholders, since the share price has fallen 15% in that time. But the silver lining is the stock is up over five years. Unfortunately its return of 37% is below the market return of 53%. Unfortunately not all shareholders will have held it for five years, so spare a thought for those caught in the 31% decline over the last three years: that's a long time to wait for profits.

Although Cyrela Brazil Realty Empreendimentos e Participações has shed R$386m from its market cap this week, let's take a look at its longer term fundamental trends and see if they've driven returns.

Check out our latest analysis for Cyrela Brazil Realty Empreendimentos e Participações

There is no denying that markets are sometimes efficient, but prices do not always reflect underlying business performance. 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).

During the last half decade, Cyrela Brazil Realty Empreendimentos e Participações became profitable. That would generally be considered a positive, so we'd expect the share price to be up. Since the company was unprofitable five years ago, but not three years ago, it's worth taking a look at the returns in the last three years, too. We can see that the Cyrela Brazil Realty Empreendimentos e Participações share price is down 31% in the last three years. In the same period, EPS is up 40% per year. It would appear there's a real mismatch between the increasing EPS and the share price, which has declined -12% a year for three years.

The company's earnings per share (over time) is depicted in the image below (click to see the exact numbers).

We know that Cyrela Brazil Realty Empreendimentos e Participações has improved its bottom line over the last three years, but what does the future have in store? It might be well worthwhile taking a look at our free report on how its financial position has changed over time.

What About Dividends?

As well as measuring the share price return, investors should also consider the total shareholder return (TSR). The TSR is a return calculation that accounts for the value of cash dividends (assuming that any dividend received was reinvested) and the calculated value of any discounted capital raisings and spin-offs. It's fair to say that the TSR gives a more complete picture for stocks that pay a dividend. In the case of Cyrela Brazil Realty Empreendimentos e Participações, it has a TSR of 83% for the last 5 years. That exceeds its share price return that we previously mentioned. And there's no prize for guessing that the dividend payments largely explain the divergence!

A Different Perspective

It's good to see that Cyrela Brazil Realty Empreendimentos e Participações has rewarded shareholders with a total shareholder return of 5.2% in the last twelve months. That's including the dividend. However, that falls short of the 13% TSR per annum it has made for shareholders, each year, over five years. The pessimistic view would be that be that the stock has its best days behind it, but on the other hand the price might simply be moderating while the business itself continues to execute. It's always interesting to track share price performance over the longer term. But to understand Cyrela Brazil Realty Empreendimentos e Participações better, we need to consider many other factors. For example, we've discovered 1 warning sign for Cyrela Brazil Realty Empreendimentos e Participações that you should be aware of before investing here.

Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of companies we expect will grow earnings.

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