Oma Säästöpankki Oyj (HEL:OMASP) stock falls 10% in past week as one-year earnings and shareholder returns continue downward trend

Even the best stock pickers will make plenty of bad investments. And there's no doubt that Oma Säästöpankki Oyj (HEL:OMASP) stock has had a really bad year. The share price has slid 55% in that time. Notably, shareholders had a tough run over the longer term, too, with a drop of 42% in the last three years. The falls have accelerated recently, with the share price down 12% in the last three months. This could be related to the recent financial results - you can catch up on the most recent data by reading our company report.

Since Oma Säästöpankki Oyj has shed €38m from its value in the past 7 days, let's see if the longer term decline has been driven by the business' economics.

See our latest analysis for Oma Säästöpankki Oyj

To paraphrase Benjamin Graham: Over the short term the market is a voting machine, but over the long term it's a weighing machine. One way to examine how market sentiment has changed over time is to look at the interaction between a company's share price and its earnings per share (EPS).

Unhappily, Oma Säästöpankki Oyj had to report a 48% decline in EPS over the last year. This proportional reduction in earnings per share isn't far from the 55% decrease in the share price. Therefore one could posit that the market has not become more concerned about the company, despite the lower EPS. Instead, the change in the share price seems to reduction in earnings per share, alone.

The image below shows how EPS has tracked over time (if you click on the image you can see greater detail).

We consider it positive that insiders have made significant purchases in the last year. Having said that, most people consider earnings and revenue growth trends to be a more meaningful guide to the business. It might be well worthwhile taking a look at our free report on Oma Säästöpankki Oyj's earnings, revenue and cash flow.

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 is a return calculation that accounts for the value of cash dividends (assuming that any dividend received was reinvested) and the calculated value of any discounted capital raisings and spin-offs. So for companies that pay a generous dividend, the TSR is often a lot higher than the share price return. As it happens, Oma Säästöpankki Oyj's TSR for the last 1 year was -53%, which exceeds the share price return mentioned earlier. The dividends paid by the company have thusly boosted the total shareholder return.

A Different Perspective

Oma Säästöpankki Oyj shareholders are down 53% for the year (even including dividends), but the market itself is up 8.4%. Even the share prices of good stocks drop sometimes, but we want to see improvements in the fundamental metrics of a business, before getting too interested. On the bright side, long term shareholders have made money, with a gain of 3% per year over half a decade. It could be that the recent sell-off is an opportunity, so it may be worth checking the fundamental data for signs of a long term growth trend. It's always interesting to track share price performance over the longer term. But to understand Oma Säästöpankki Oyj better, we need to consider many other factors. Even so, be aware that Oma Säästöpankki Oyj is showing 2 warning signs in our investment analysis , you should know about...

Oma Säästöpankki Oyj is not the only stock insiders are buying. So take a peek at this free list of small cap companies at attractive valuations which insiders have been buying.

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