Did You Participate In Any Of Garware Technical Fibres' (NSE:GARFIBRES) Incredible 614% Return?

We think all investors should try to buy and hold high quality multi-year winners. While not every stock performs well, when investors win, they can win big. To wit, the Garware Technical Fibres Limited (NSE:GARFIBRES) share price has soared 587% over five years. If that doesn't get you thinking about long term investing, we don't know what will. It's also good to see the share price up 14% over the last quarter. But this could be related to the strong market, which is up 22% in the last three months.

It really delights us to see such great share price performance for investors.

View our latest analysis for Garware Technical Fibres

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...' By comparing earnings per share (EPS) and share price changes over time, we can get a feel for how investor attitudes to a company have morphed over time.

Over half a decade, Garware Technical Fibres managed to grow its earnings per share at 16% a year. This EPS growth is slower than the share price growth of 47% per year, over the same period. So it's fair to assume the market has a higher opinion of the business than it did five years ago. And that's hardly shocking given the track record of growth.

You can see below how EPS has changed over time (discover the exact values by clicking on the image).

This free interactive report on Garware Technical Fibres' earnings, revenue and cash flow is a great place to start, if you want to investigate the stock further.

What About Dividends?

When looking at investment returns, it is important to consider the difference between total shareholder return (TSR) and share price return. 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. So for companies that pay a generous dividend, the TSR is often a lot higher than the share price return. As it happens, Garware Technical Fibres' TSR for the last 5 years was 614%, which exceeds the share price return mentioned earlier. And there's no prize for guessing that the dividend payments largely explain the divergence!

A Different Perspective

It's good to see that Garware Technical Fibres has rewarded shareholders with a total shareholder return of 48% in the last twelve months. And that does include the dividend. However, that falls short of the 48% TSR per annum it has made for shareholders, each year, over five years. It's always interesting to track share price performance over the longer term. But to understand Garware Technical Fibres better, we need to consider many other factors. For example, we've discovered 1 warning sign for Garware Technical Fibres that you should be aware of before investing here.

We will like Garware Technical Fibres better if we see some big insider buys. While we wait, check out this free list of growing companies with considerable, recent, insider buying.

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