Top Ramdor Systems & Computers (1990)'s (TLV:TOPS) 28% CAGR outpaced the company's earnings growth over the same five-year period

The most you can lose on any stock (assuming you don't use leverage) is 100% of your money. But on the bright side, if you buy shares in a high quality company at the right price, you can gain well over 100%. Long term Top Ramdor Systems & Computers Co. (1990) Ltd (TLV:TOPS) shareholders would be well aware of this, since the stock is up 193% in five years. And in the last month, the share price has gained 11%. But this could be related to good market conditions -- stocks in its market are up 9.6% in the last month.

The past week has proven to be lucrative for Top Ramdor Systems & Computers (1990) investors, so let's see if fundamentals drove the company's five-year performance.

View our latest analysis for Top Ramdor Systems & Computers (1990)

To quote Buffett, 'Ships will sail around the world but the Flat Earth Society will flourish. There will continue to be wide discrepancies between price and value in the marketplace...' 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, Top Ramdor Systems & Computers (1990) managed to grow its earnings per share at 17% a year. This EPS growth is lower than the 24% average annual increase in the share price. This suggests that market participants hold the company in higher regard, these days. And that's hardly shocking given the track record of growth.

The company's earnings per share (over time) is depicted in the image below (click to see the exact numbers).

Dive deeper into Top Ramdor Systems & Computers (1990)'s key metrics by checking this interactive graph of Top Ramdor Systems & Computers (1990)'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 incorporates the value of any spin-offs or discounted capital raisings, along with any dividends, based on the assumption that the dividends are reinvested. Arguably, the TSR gives a more comprehensive picture of the return generated by a stock. We note that for Top Ramdor Systems & Computers (1990) the TSR over the last 5 years was 240%, which is better than the share price return mentioned above. This is largely a result of its dividend payments!

A Different Perspective

Top Ramdor Systems & Computers (1990) provided a TSR of 24% over the last twelve months. But that was short of the market average. It's probably a good sign that the company has an even better long term track record, having provided shareholders with an annual TSR of 28% over five years. It's quite possible the business continues to execute with prowess, even as the share price gains are slowing. 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. Take risks, for example - Top Ramdor Systems & Computers (1990) has 3 warning signs we think you should be aware of.

But note: Top Ramdor Systems & Computers (1990) may not be the best stock to buy. So take a peek at this free list of interesting companies with past earnings growth (and further growth forecast).

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.