CORESTATE Capital Holding (ETR:CCAP) Share Prices Have Dropped 71% In The Last Three Years

If you are building a properly diversified stock portfolio, the chances are some of your picks will perform badly. But the long term shareholders of CORESTATE Capital Holding S.A. (ETR:CCAP) have had an unfortunate run in the last three years. Sadly for them, the share price is down 71% in that time. And the ride hasn't got any smoother in recent times over the last year, with the price 63% lower in that time. Unhappily, the share price slid 1.2% in the last week.

Check out our latest analysis for CORESTATE Capital Holding

To quote Buffett, 'Ships will sail around the world but the Flat Earth Society will flourish. There will continue to be wide discrepancies between price and value in the marketplace...' One flawed but reasonable way to assess how sentiment around a company has changed is to compare the earnings per share (EPS) with the share price.

Although the share price is down over three years, CORESTATE Capital Holding actually managed to grow EPS by 27% per year in that time. This is quite a puzzle, and suggests there might be something temporarily buoying the share price. Alternatively, growth expectations may have been unreasonable in the past.

Since the change in EPS doesn't seem to correlate with the change in share price, it's worth taking a look at other metrics.

Revenue is actually up 13% over the three years, so the share price drop doesn't seem to hinge on revenue, either. This analysis is just perfunctory, but it might be worth researching CORESTATE Capital Holding more closely, as sometimes stocks fall unfairly. This could present an opportunity.

You can see how earnings and revenue have changed over time in the image below (click on the chart to see the exact values).

Take a more thorough look at CORESTATE Capital Holding's financial health with this free report on its balance sheet.

What about the Total Shareholder Return (TSR)?

Investors should note that there's a difference between CORESTATE Capital Holding's total shareholder return (TSR) and its share price change, which we've covered above. The TSR attempts to capture the value of dividends (as if they were reinvested) as well as any spin-offs or discounted capital raisings offered to shareholders. Dividends have been really beneficial for CORESTATE Capital Holding shareholders, and that cash payout explains why its total shareholder loss of 68%, over the last 3 years, isn't as bad as the share price return.

A Different Perspective

CORESTATE Capital Holding shareholders are down 63% for the year, but the broader market is up 8.2%. However, keep in mind that even the best stocks will sometimes underperform the market over a twelve month period. The three-year loss of 19% per year isn't as bad as the last twelve months, suggesting that the company has not been able to convince the market it has solved its problems. Although Baron Rothschild famously said to "buy when there's blood in the streets, even if the blood is your own", he also focusses on high quality stocks with solid prospects. I find it very interesting to look at share price over the long term as a proxy for business performance. But to truly gain insight, we need to consider other information, too. Case in point: We've spotted 3 warning signs for CORESTATE Capital Holding you should be aware of, and 1 of them makes us a bit uncomfortable.

For those who like to find winning investments this free list of growing companies with recent insider purchasing, could be just the ticket.

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

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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. 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.
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