Did You Miss Afcon Holdings' (TLV:AFHL) Impressive 104% Share Price Gain?

Unfortunately, investing is risky - companies can and do go bankrupt. But if you pick the right business to buy shares in, you can make more than you can lose. For example, the Afcon Holdings Ltd (TLV:AFHL) share price has soared 104% in the last year. Most would be very happy with that, especially in just one year! On top of that, the share price is up 35% in about a quarter. On the other hand, longer term shareholders have had a tougher run, with the stock falling 2.4% in three years.

See our latest analysis for Afcon Holdings

In his essay The Superinvestors of Graham-and-Doddsville Warren Buffett described how share prices do not always rationally reflect the value of a business. One flawed but reasonable way to assess how sentiment around a company has changed is to compare the earnings per share (EPS) with the share price.

During the last year Afcon Holdings grew its earnings per share (EPS) by 60%. Though we do note extraordinary items affected the bottom line. This EPS growth is significantly lower than the 104% increase in the share price. This indicates that the market is now more optimistic about the stock.

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

Dive deeper into Afcon Holdings' key metrics by checking this interactive graph of Afcon Holdings's earnings, revenue and cash flow.

What about the Total Shareholder Return (TSR)?

We'd be remiss not to mention the difference between Afcon Holdings' total shareholder return (TSR) and its share price return. 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. Dividends have been really beneficial for Afcon Holdings shareholders, and that cash payout contributed to why its TSR of 115%, over the last year, is better than the share price return.

A Different Perspective

We're pleased to report that Afcon Holdings shareholders have received a total shareholder return of 115% over one year. Since the one-year TSR is better than the five-year TSR (the latter coming in at 11% per year), it would seem that the stock's performance has improved in recent times. In the best case scenario, this may hint at some real business momentum, implying that now could be a great time to delve deeper. While it is well worth considering the different impacts that market conditions can have on the share price, there are other factors that are even more important. To that end, you should learn about the 3 warning signs we've spotted with Afcon Holdings (including 2 which can't be ignored) .

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 IL 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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