C. Mer Industries (TLV:CMER) delivers shareholders splendid 154% return over 1 year, surging 10% in the last week alone

When you buy shares in a company, there is always a risk that the price drops to zero. But if you pick the right business to buy shares in, you can make more than you can lose. For example, the C. Mer Industries Ltd. (TLV:CMER) share price has soared 154% in the last 1 year. Most would be very happy with that, especially in just one year! It's even up 10% in the last week. Also impressive, the stock is up 150% over three years, making long term shareholders happy, too.

The past week has proven to be lucrative for C. Mer Industries investors, so let's see if fundamentals drove the company's one-year performance.

View our latest analysis for C. Mer Industries

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 C. Mer Industries grew its earnings per share, moving from a loss to a profit.

When a company is just on the edge of profitability it can be well worth considering other metrics in order to more precisely gauge growth (and therefore understand share price movements).

However the year on year revenue growth of 16% would help. We do see some companies suppress earnings in order to accelerate revenue growth.

You can see how earnings and revenue have changed over time in the image below (click on the chart to see the exact values).

If you are thinking of buying or selling C. Mer Industries stock, you should check out this FREE detailed report on its balance sheet.

A Different Perspective

It's nice to see that C. Mer Industries shareholders have received a total shareholder return of 154% over the last year. That gain is better than the annual TSR over five years, which is 16%. Therefore it seems like sentiment around the company has been positive lately. 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. Even so, be aware that C. Mer Industries is showing 3 warning signs in our investment analysis , and 2 of those are concerning...

If you are like me, then you will not want to miss this free list of undervalued small caps 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 Israeli 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.