Waberer's International Nyrt (BST:3WB) delivers shareholders massive 36% CAGR over 5 years, surging 12% in the last week alone

Buying shares in the best businesses can build meaningful wealth for you and your family. While not every stock performs well, when investors win, they can win big. Just think about the savvy investors who held Waberer's International Nyrt. (BST:3WB) shares for the last five years, while they gained 324%. And this is just one example of the epic gains achieved by some long term investors. On top of that, the share price is up 31% in about a quarter. But this move may well have been assisted by the reasonably buoyant market (up 13% in 90 days).

Since it's been a strong week for Waberer's International Nyrt shareholders, let's have a look at trend of the longer term fundamentals.

View our latest analysis for Waberer's International Nyrt

While the efficient markets hypothesis continues to be taught by some, it has been proven that markets are over-reactive dynamic systems, and investors are not always rational. One imperfect but simple way to consider how the market perception of a company has shifted is to compare the change in the earnings per share (EPS) with the share price movement.

During the five years of share price growth, Waberer's International Nyrt moved from a loss to profitability. Sometimes, the start of profitability is a major inflection point that can signal fast earnings growth to come, which in turn justifies very strong share price gains.

You can see below how EPS has changed over time (discover the exact values by clicking on the image).

Before buying or selling a stock, we always recommend a close examination of historic growth trends, available here.

What About Dividends?

As well as measuring the share price return, investors should also consider the total shareholder return (TSR). Whereas the share price return only reflects the change in the share price, the TSR includes the value of dividends (assuming they were reinvested) and the benefit of any discounted capital raising or spin-off. So for companies that pay a generous dividend, the TSR is often a lot higher than the share price return. We note that for Waberer's International Nyrt the TSR over the last 5 years was 360%, which is better than the share price return mentioned above. This is largely a result of its dividend payments!

A Different Perspective

We're pleased to report that Waberer's International Nyrt shareholders have received a total shareholder return of 33% over one year. Of course, that includes the dividend. However, the TSR over five years, coming in at 36% per year, is even more impressive. 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. Consider for instance, the ever-present spectre of investment risk. We've identified 1 warning sign with Waberer's International Nyrt , and understanding them should be part of your investment process.

Of course Waberer's International Nyrt 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 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.