How Much Did Dah Sing Banking Group's(HKG:2356) Shareholders Earn From Share Price Movements Over The Last Three Years?

While not a mind-blowing move, it is good to see that the Dah Sing Banking Group Limited (HKG:2356) share price has gained 18% in the last three months. But that doesn't change the fact that the returns over the last three years have been less than pleasing. In fact, the share price is down 55% in the last three years, falling well short of the market return.

View our latest analysis for Dah Sing Banking Group

To paraphrase Benjamin Graham: Over the short term the market is a voting machine, but over the long term it's a weighing machine. 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 the three years that the share price fell, Dah Sing Banking Group's earnings per share (EPS) dropped by 8.3% each year. The share price decline of 23% is actually steeper than the EPS slippage. So it seems the market was too confident about the business, in the past. This increased caution is also evident in the rather low P/E ratio, which is sitting at 6.15.

The company's earnings per share (over time) is depicted in the image below (click to see the exact numbers).

Dive deeper into Dah Sing Banking Group's key metrics by checking this interactive graph of Dah Sing Banking Group's earnings, revenue and cash flow.

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 incorporates the value of any spin-offs or discounted capital raisings, along with any dividends, based on the assumption that the dividends are reinvested. It's fair to say that the TSR gives a more complete picture for stocks that pay a dividend. We note that for Dah Sing Banking Group the TSR over the last 3 years was -49%, which is better than the share price return mentioned above. This is largely a result of its dividend payments!

A Different Perspective

Investors in Dah Sing Banking Group had a tough year, with a total loss of 18% (including dividends), against a market gain of about 20%. Even the share prices of good stocks drop sometimes, but we want to see improvements in the fundamental metrics of a business, before getting too interested. Regrettably, last year's performance caps off a bad run, with the shareholders facing a total loss of 4% per year over five years. We realise that Baron Rothschild has said investors should "buy when there is blood on the streets", but we caution that investors should first be sure they are buying a high quality business. 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. Case in point: We've spotted 1 warning sign for Dah Sing Banking Group you should be aware of.

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 HK exchanges.

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