thyssenkrupp (ETR:TKA) grows 3.9% this week, taking one-year gains to 109%

When you buy shares in a company, there is always a risk that the price drops to zero. But if you pick the right stock, you can make a lot more than 100%. For example, the thyssenkrupp AG (ETR:TKA) share price has soared 103% in the last 1 year. Most would be very happy with that, especially in just one year! Meanwhile the share price is 3.9% higher than it was a week ago. It is also impressive that the stock is up 36% over three years, adding to the sense that it is a real winner.

The past week has proven to be lucrative for thyssenkrupp investors, so let's see if fundamentals drove the company's one-year performance.

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To paraphrase Benjamin Graham: Over the short term the market is a voting machine, but over the long term it's a weighing machine. 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.

thyssenkrupp was able to grow EPS by 56% in the last twelve months. We note, however, that extraordinary items have impacted earnings. This EPS growth is significantly lower than the 103% increase in the share price. So it's fair to assume the market has a higher opinion of the business than it a year ago.

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

We know that thyssenkrupp has improved its bottom line lately, but is it going to grow revenue? Check if analysts think thyssenkrupp will grow revenue in the future.

What About Dividends?

When looking at investment returns, it is important to consider the difference between total shareholder return (TSR) and share price return. The TSR incorporates the value of any spin-offs or discounted capital raisings, along with any dividends, based on the assumption that the dividends are reinvested. It's fair to say that the TSR gives a more complete picture for stocks that pay a dividend. As it happens, thyssenkrupp's TSR for the last 1 year was 109%, which exceeds the share price return mentioned earlier. This is largely a result of its dividend payments!

A Different Perspective

We're pleased to report that thyssenkrupp shareholders have received a total shareholder return of 109% over one year. Of course, that includes the dividend. Since the one-year TSR is better than the five-year TSR (the latter coming in at 9% per year), it would seem that the stock's performance has improved in recent times. Someone with an optimistic perspective could view the recent improvement in TSR as indicating that the business itself is getting better with time. 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. To that end, you should be aware of the 1 warning sign we've spotted with thyssenkrupp .

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