Orbit Technologies' (TLV:ORBI) earnings growth rate lags the 17% CAGR delivered to shareholders

It might be of some concern to shareholders to see the Orbit Technologies Ltd (TLV:ORBI) share price down 12% in the last month. But that doesn't change the fact that the returns over the last five years have been very strong. It's fair to say most would be happy with 115% the gain in that time. So while it's never fun to see a share price fall, it's important to look at a longer time horizon. Ultimately business performance will determine whether the stock price continues the positive long term trend.

Although Orbit Technologies has shed ₪70m from its market cap this week, let's take a look at its longer term fundamental trends and see if they've driven returns.

Check out our latest analysis for Orbit Technologies

While markets are a powerful pricing mechanism, share prices reflect investor sentiment, not just underlying business performance. One imperfect but simple way to consider how the market perception of a company has shifted is to compare the change in the earnings per share (EPS) with the share price movement.

Over half a decade, Orbit Technologies managed to grow its earnings per share at 54% a year. This EPS growth is higher than the 17% average annual increase in the share price. So one could conclude that the broader market has become more cautious towards the stock.

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

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

A Different Perspective

We're pleased to report that Orbit Technologies shareholders have received a total shareholder return of 16% over one year. Having said that, the five-year TSR of 17% a year, is even better. Before forming an opinion on Orbit Technologies you might want to consider these 3 valuation metrics.

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 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.