Alony-Hetz Properties & Investments (TLV:ALHE) Has Compensated Shareholders With A Respectable 79% Return On Their Investment

The main point of investing for the long term is to make money. But more than that, you probably want to see it rise more than the market average. But Alony-Hetz Properties & Investments Ltd (TLV:ALHE) has fallen short of that second goal, with a share price rise of 46% over five years, which is below the market return. But if you include dividends then the return is market-beating. Unfortunately the share price is down 1.6% in the last year.

View our latest analysis for Alony-Hetz Properties & Investments

To paraphrase Benjamin Graham: Over the short term the market is a voting machine, but over the long term it's a weighing machine. 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 half a decade, Alony-Hetz Properties & Investments managed to grow its earnings per share at 6.0% a year. This EPS growth is lower than the 8% average annual increase in the share price. This suggests that market participants hold the company in higher regard, these days. That's not necessarily surprising considering the five-year track record of earnings growth.

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 Alony-Hetz Properties & Investments' key metrics by checking this interactive graph of Alony-Hetz Properties & Investments's earnings, revenue and cash flow.

What About Dividends?

It is important to consider the total shareholder return, as well as the share price return, for any given stock. The TSR is a return calculation that accounts for the value of cash dividends (assuming that any dividend received was reinvested) and the calculated value of any discounted capital raisings and spin-offs. It's fair to say that the TSR gives a more complete picture for stocks that pay a dividend. We note that for Alony-Hetz Properties & Investments the TSR over the last 5 years was 79%, which is better than the share price return mentioned above. The dividends paid by the company have thusly boosted the total shareholder return.

A Different Perspective

Alony-Hetz Properties & Investments shareholders are up 1.3% for the year (even including dividends). But that return falls short of the market. If we look back over five years, the returns are even better, coming in at 12% per year for five years. It may well be that this is a business worth popping on the watching, given the continuing positive reception, over time, from the market. 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. For example, we've discovered 3 warning signs for Alony-Hetz Properties & Investments (1 shouldn't be ignored!) that you should be aware of before investing here.

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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