The Israel (TLV:ILCO) Share Price Is Up 53% And Shareholders Are Holding On

Passive investing in index funds can generate returns that roughly match the overall market. But if you pick the right individual stocks, you could make more than that. For example, the Israel Corporation Ltd (TLV:ILCO) share price is up 53% in the last year, clearly besting the market decline of around 0.7% (not including dividends). That's a solid performance by our standards! The longer term returns have not been as good, with the stock price only 9.2% higher than it was three years ago.

See our latest analysis for Israel

While markets are a powerful pricing mechanism, share prices reflect investor sentiment, not just 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).

Over the last twelve months Israel went from profitable to unprofitable. While some may see this as temporary, we're a skeptical bunch, and so we're a little surprised to see the share price go up. It may be that the company has done well on other metrics.

We are skeptical of the suggestion that the 0.009% dividend yield would entice buyers to the stock. Unfortunately Israel's fell 13% over twelve months. So the fundamental metrics don't provide an obvious explanation for the share price gain.

The graphic below depicts how earnings and revenue have changed over time (unveil the exact values by clicking on the image).

Take a more thorough look at Israel's financial health with this free report on its balance sheet.

A Different Perspective

It's nice to see that Israel shareholders have received a total shareholder return of 53% over the last year. That's including the dividend. That gain is better than the annual TSR over five years, which is 8%. Therefore it seems like sentiment around the company has been positive lately. In the best case scenario, this may hint at some real business momentum, implying that now could be a great time to delve deeper. It's always interesting to track share price performance over the longer term. But to understand Israel better, we need to consider many other factors. Even so, be aware that Israel is showing 3 warning signs in our investment analysis , and 2 of those can't be ignored...

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 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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