Investors Who Bought Rovio Entertainment Oyj (HEL:ROVIO) Shares A Year Ago Are Now Up 88%

These days it's easy to simply buy an index fund, and your returns should (roughly) match the market. But if you pick the right individual stocks, you could make more than that. To wit, the Rovio Entertainment Oyj (HEL:ROVIO) share price is 88% higher than it was a year ago, much better than the market return of around 17% (not including dividends) in the same period. So that should have shareholders smiling. Also impressive, the stock is up 52% over three years, making long term shareholders happy, too.

Check out our latest analysis for Rovio Entertainment Oyj

While markets are a powerful pricing mechanism, share prices reflect investor sentiment, not just underlying business performance. 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).

Rovio Entertainment Oyj was able to grow EPS by 156% in the last twelve months. This EPS growth is significantly higher than the 88% increase in the share price. So it seems like the market has cooled on Rovio Entertainment Oyj, despite the growth. Interesting.

The graphic below depicts how EPS has changed over time (unveil the exact values by clicking on the image).

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

What About Dividends?

As well as measuring the share price return, investors should also consider the total shareholder return (TSR). 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, Rovio Entertainment Oyj's TSR for the last year was 92%, which exceeds the share price return mentioned earlier. This is largely a result of its dividend payments!

A Different Perspective

It's nice to see that Rovio Entertainment Oyj shareholders have gained 92% (in total) over the last year. And yes, that does include the dividend. That's better than the annualized TSR of 17% over the last three years. These improved returns may hint at some real business momentum, implying that now could be a great time to delve deeper. 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 Rovio Entertainment Oyj , and understanding them should be part of your investment process.

Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of companies we expect will grow earnings.

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