IRB-Brasil Resseguros (BVMF:IRBR3) shareholder returns have been impressive, earning 120% in 1 year

While IRB-Brasil Resseguros S.A. (BVMF:IRBR3) shareholders are probably generally happy, the stock hasn't had particularly good run recently, with the share price falling 18% in the last quarter. But that doesn't detract from the splendid returns of the last year. Indeed, the share price is up an impressive 120% in that time. So some might not be surprised to see the price retrace some. Investors should be wondering whether the business itself has the fundamental value required to continue to drive gains.

On the back of a solid 7-day performance, let's check what role the company's fundamentals have played in driving long term shareholder returns.

Check out our latest analysis for IRB-Brasil Resseguros

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

During the last year IRB-Brasil Resseguros grew its earnings per share, moving from a loss to a profit.

We think the growth looks very prospective, so we're not surprised the market liked it too. Inflection points like this can be a great time to take a closer look at a company.

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

It is of course excellent to see how IRB-Brasil Resseguros has grown profits over the years, but the future is more important for shareholders. Take a more thorough look at IRB-Brasil Resseguros' financial health with this free report on its balance sheet.

A Different Perspective

We're pleased to report that IRB-Brasil Resseguros shareholders have received a total shareholder return of 120% over one year. That certainly beats the loss of about 14% per year over the last half decade. We generally put more weight on the long term performance over the short term, but the recent improvement could hint at a (positive) inflection point within the business. 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 - IRB-Brasil Resseguros has 2 warning signs (and 1 which is a bit concerning) we think you should know about.

Of course IRB-Brasil Resseguros may not be the best stock to buy. So you may wish to see this free collection of growth stocks.

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.