Investors Who Bought Motorpoint Group (LON:MOTR) Shares Three Years Ago Are Now Up 65%

By buying an index fund, investors can approximate the average market return. But many of us dare to dream of bigger returns, and build a portfolio ourselves. Just take a look at Motorpoint Group plc (LON:MOTR), which is up 65%, over three years, soundly beating the market decline of 11% (not including dividends). However, more recent returns haven't been as impressive as that, with the stock returning just 18% in the last year , including dividends .

View our latest analysis for Motorpoint Group

While markets are a powerful pricing mechanism, share prices reflect investor sentiment, not just underlying business performance. By comparing earnings per share (EPS) and share price changes over time, we can get a feel for how investor attitudes to a company have morphed over time.

During three years of share price growth, Motorpoint Group achieved compound earnings per share growth of 24% per year. This EPS growth is higher than the 18% average annual increase in the share price. So it seems investors have become more cautious about the company, over time.

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

This free interactive report on Motorpoint Group's earnings, revenue and cash flow is a great place to start, if you want to investigate the stock further.

What about the Total Shareholder Return (TSR)?

Investors should note that there's a difference between Motorpoint Group's total shareholder return (TSR) and its share price change, which we've covered above. The TSR attempts to capture the value of dividends (as if they were reinvested) as well as any spin-offs or discounted capital raisings offered to shareholders. Its history of dividend payouts mean that Motorpoint Group's TSR of 77% over the last 3 years is better than the share price return.

A Different Perspective

Pleasingly, Motorpoint Group's total shareholder return last year was 18%. That falls short of the 21% it has made, for shareholders, each year, over three years. It's always interesting to track share price performance over the longer term. But to understand Motorpoint Group better, we need to consider many other factors. For example, we've discovered 1 warning sign for Motorpoint Group that you should be aware of before investing here.

We will like Motorpoint Group better if we see some big insider buys. While we wait, check out this free list of growing companies with considerable, recent, insider buying.

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