The three-year decline in earnings for Caisse Régionale de Crédit Agricole Mutuel de la Touraine et du Poitou Société Coopérative EPA:CRTO) isn't encouraging, but shareholders are still up 120% over that period

It hasn't been the best quarter for Caisse Régionale de Crédit Agricole Mutuel de la Touraine et du Poitou Société Coopérative (EPA:CRTO) shareholders, since the share price has fallen 13% in that time. But that doesn't change the fact that the returns over the last three years have been pleasing. In fact, the company's share price bested the return of its market index in that time, posting a gain of 94%.

In light of the stock dropping 6.1% in the past week, we want to investigate the longer term story, and see if fundamentals have been the driver of the company's positive three-year return.

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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 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.

Over the last three years, Caisse Régionale de Crédit Agricole Mutuel de la Touraine et du Poitou Société Coopérative failed to grow earnings per share, which fell 2.7% (annualized).

Given the share price resilience, we don't think the (declining) EPS numbers are a good measure of how the business is moving forward, right now. So other metrics may hold the key to understanding what is influencing investors.

You can only imagine how long term shareholders feel about the declining revenue trend (slipping at 1.3% per year). The only thing that's clear is there is low correlation between Caisse Régionale de Crédit Agricole Mutuel de la Touraine et du Poitou Société Coopérative's share price and its historic fundamental data. Further research may be required!

The graphic below depicts how earnings and revenue have changed over time (unveil the exact values by clicking on the image).

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

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. Arguably, the TSR gives a more comprehensive picture of the return generated by a stock. We note that for Caisse Régionale de Crédit Agricole Mutuel de la Touraine et du Poitou Société Coopérative the TSR over the last 3 years was 120%, which is better than the share price return mentioned above. And there's no prize for guessing that the dividend payments largely explain the divergence!

A Different Perspective

It's nice to see that Caisse Régionale de Crédit Agricole Mutuel de la Touraine et du Poitou Société Coopérative shareholders have received a total shareholder return of 55% over the last year. That's including the dividend. Since the one-year TSR is better than the five-year TSR (the latter coming in at 8% per year), it would seem that the stock's performance has improved in recent times. Someone with an optimistic perspective could view the recent improvement in TSR as indicating that the business itself is getting better with time. Before deciding if you like the current share price, check how Caisse Régionale de Crédit Agricole Mutuel de la Touraine et du Poitou Société Coopérative scores on these 3 valuation metrics.

But note: Caisse Régionale de Crédit Agricole Mutuel de la Touraine et du Poitou Société Coopérative 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 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.