Despite shrinking by €36m in the past week, EQS Group (ETR:EQS) shareholders are still up 312% over 5 years

EQS Group AG (ETR:EQS) shareholders might be concerned after seeing the share price drop 11% in the last month. But that doesn't undermine the fantastic longer term performance (measured over five years). In fact, during that period, the share price climbed 307%. Impressive! So we don't think the recent decline in the share price means its story is a sad one. The most important thing for savvy investors to consider is whether the underlying business can justify the share price gain.

While this past week has detracted from the company's five-year return, let's look at the recent trends of the underlying business and see if the gains have been in alignment.

View our latest analysis for EQS Group

EQS Group wasn't profitable in the last twelve months, it is unlikely we'll see a strong correlation between its share price and its earnings per share (EPS). Arguably revenue is our next best option. Shareholders of unprofitable companies usually expect strong revenue growth. As you can imagine, fast revenue growth, when maintained, often leads to fast profit growth.

For the last half decade, EQS Group can boast revenue growth at a rate of 8.9% per year. That's a fairly respectable growth rate. Arguably it's more than reflected in the very strong share price gain of 32% a year over a half a decade. It might not be cheap but a (long-term) growth stock like this is usually well worth taking a closer look at.

The company's revenue and earnings (over time) are depicted in the image below (click to see the exact numbers).

You can see how its balance sheet has strengthened (or weakened) over time in this free interactive graphic.

What about the Total Shareholder Return (TSR)?

Investors should note that there's a difference between EQS Group'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. EQS Group's TSR of 312% for the 5 years exceeded its share price return, because it has paid dividends.

A Different Perspective

It's nice to see that EQS Group shareholders have received a total shareholder return of 15% over the last year. However, the TSR over five years, coming in at 33% per year, is even more impressive. 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 EQS Group better, we need to consider many other factors. Take risks, for example - EQS Group has 1 warning sign we think you should be aware of.

But note: EQS Group may not be the best stock to buy. So take a peek at this free list of interesting companies with past earnings growth (and further growth forecast).

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. 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.