Caisse Régionale de Crédit Agricole Mutuel du Languedoc Société coopérative's (EPA:CRLA) earnings have declined over five years, contributing to shareholders 19% loss

In order to justify the effort of selecting individual stocks, it's worth striving to beat the returns from a market index fund. But even the best stock picker will only win with some selections. At this point some shareholders may be questioning their investment in Caisse Régionale de Crédit Agricole Mutuel du Languedoc Société coopérative (EPA:CRLA), since the last five years saw the share price fall 34%. On the other hand the share price has bounced 6.2% over the last week.

While the last five years has been tough for Caisse Régionale de Crédit Agricole Mutuel du Languedoc Société coopérative shareholders, this past week has shown signs of promise. So let's look at the longer term fundamentals and see if they've been the driver of the negative returns.

View our latest analysis for Caisse Régionale de Crédit Agricole Mutuel du Languedoc Société coopérative

While markets are a powerful pricing mechanism, share prices reflect investor sentiment, not just underlying business performance. 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 over which the share price declined, Caisse Régionale de Crédit Agricole Mutuel du Languedoc Société coopérative's earnings per share (EPS) dropped by 2.6% each year. Readers should note that the share price has fallen faster than the EPS, at a rate of 8% per year, over the period. This implies that the market was previously too optimistic about the stock. The low P/E ratio of 5.42 further reflects this reticence.

You can see how EPS has changed over time in the image below (click on the chart to see the exact values).

We're pleased to report that the CEO is remunerated more modestly than most CEOs at similarly capitalized companies. It's always worth keeping an eye on CEO pay, but a more important question is whether the company will grow earnings throughout the years. It might be well worthwhile taking a look at our free report on Caisse Régionale de Crédit Agricole Mutuel du Languedoc Société coopérative's earnings, revenue and cash flow.

What About Dividends?

As well as measuring the share price return, investors should also consider the total shareholder return (TSR). The TSR incorporates the value of any spin-offs or discounted capital raisings, along with any dividends, based on the assumption that the dividends are reinvested. Arguably, the TSR gives a more comprehensive picture of the return generated by a stock. In the case of Caisse Régionale de Crédit Agricole Mutuel du Languedoc Société coopérative, it has a TSR of -19% for the last 5 years. That exceeds its share price return that we previously mentioned. This is largely a result of its dividend payments!

A Different Perspective

It's nice to see that Caisse Régionale de Crédit Agricole Mutuel du Languedoc Société coopérative shareholders have received a total shareholder return of 16% over the last year. And that does include the dividend. Notably the five-year annualised TSR loss of 3% per year compares very unfavourably with the recent share price performance. This makes us a little wary, but the business might have turned around its fortunes. Before forming an opinion on Caisse Régionale de Crédit Agricole Mutuel du Languedoc Société coopérative you might want to consider the cold hard cash it pays as a dividend. This free chart tracks its dividend over time.

If you like to buy stocks alongside management, then you might just love this free list of companies. (Hint: insiders have been buying them).

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