If You Had Bought BYD (HKG:1211) Stock A Year Ago, You Could Pocket A 359% Gain Today

It hasn't been the best quarter for BYD Company Limited (HKG:1211) shareholders, since the share price has fallen 20% in that time. But that doesn't change the fact that the returns over the last year have been spectacular. In fact, it is up 359% in that time. So the recent fall isn't enough to negate the good performance. Only time will tell if there is still too much optimism currently reflected in the share price.

See our latest analysis for BYD

There is no denying that markets are sometimes efficient, but prices do not always reflect 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).

During the last year BYD grew its earnings per share (EPS) by 195%. This EPS growth is significantly lower than the 359% increase in the share price. So it's fair to assume the market has a higher opinion of the business than it a year ago. The fairly generous P/E ratio of 101.96 also points to this optimism.

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

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

A Different Perspective

It's good to see that BYD has rewarded shareholders with a total shareholder return of 359% in the last twelve months. That's including the dividend. Since the one-year TSR is better than the five-year TSR (the latter coming in at 34% 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. 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 risks, for instance. Every company has them, and we've spotted 3 warning signs for BYD you should know about.

If you are like me, then you will not want to miss this free list of growing companies that insiders are buying.

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