The one-year shareholder returns and company earnings persist lower as Crompton Greaves Consumer Electricals (NSE:CROMPTON) stock falls a further 14% in past week

Investors can approximate the average market return by buying an index fund. When you buy individual stocks, you can make higher profits, but you also face the risk of under-performance. Investors in Crompton Greaves Consumer Electricals Limited (NSE:CROMPTON) have tasted that bitter downside in the last year, as the share price dropped 33%. That contrasts poorly with the market decline of 1.4%. Longer term investors have fared much better, since the share price is up 16% in three years. Furthermore, it's down 23% in about a quarter. That's not much fun for holders.

Given the past week has been tough on shareholders, let's investigate the fundamentals and see what we can learn.

See our latest analysis for Crompton Greaves Consumer Electricals

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 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).

Unhappily, Crompton Greaves Consumer Electricals had to report a 21% decline in EPS over the last year. The share price decline of 33% is actually more than the EPS drop. Unsurprisingly, given the lack of EPS growth, the market seems to be more cautious about the stock.

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

It might be well worthwhile taking a look at our free report on Crompton Greaves Consumer Electricals' earnings, revenue and cash flow.

A Different Perspective

While the broader market lost about 1.4% in the twelve months, Crompton Greaves Consumer Electricals shareholders did even worse, losing 32% (even including dividends). Having said that, it's inevitable that some stocks will be oversold in a falling market. The key is to keep your eyes on the fundamental developments. On the bright side, long term shareholders have made money, with a gain of 2% per year over half a decade. It could be that the recent sell-off is an opportunity, so it may be worth checking the fundamental data for signs of a long term growth trend. It's always interesting to track share price performance over the longer term. But to understand Crompton Greaves Consumer Electricals better, we need to consider many other factors. For example, we've discovered 2 warning signs for Crompton Greaves Consumer Electricals that you should be aware of before investing here.

For those who like to find winning investments this free list of growing companies with recent insider purchasing, could be just the ticket.

Please note, the market returns quoted in this article reflect the market weighted average returns of stocks that currently trade on Indian 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.