Aditya Birla Money's (NSE:BIRLAMONEY) five-year earnings growth trails the incredible shareholder returns

Some Aditya Birla Money Limited (NSE:BIRLAMONEY) shareholders are probably rather concerned to see the share price fall 41% over the last three months. But over five years returns have been remarkably great. Indeed, the share price is up a whopping 757% in that time. Arguably, the recent fall is to be expected after such a strong rise. Of course what matters most is whether the business can improve itself sustainably, thus justifying a higher price. We love happy stories like this one. The company should be really proud of that performance!

Since it's been a strong week for Aditya Birla Money shareholders, let's have a look at trend of the longer term fundamentals.

View our latest analysis for Aditya Birla Money

There is no denying that markets are sometimes efficient, but prices do not always reflect underlying business performance. 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.

During five years of share price growth, Aditya Birla Money achieved compound earnings per share (EPS) growth of 46% per year. This EPS growth is reasonably close to the 54% average annual increase in the share price. This indicates that investor sentiment towards the company has not changed a great deal. Indeed, it would appear the share price is reacting to the EPS.

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

Before buying or selling a stock, we always recommend a close examination of historic growth trends, available here.

A Different Perspective

We're pleased to report that Aditya Birla Money shareholders have received a total shareholder return of 64% over one year. That's better than the annualised return of 54% over half a decade, implying that the company is doing better recently. 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 Aditya Birla Money better, we need to consider many other factors. Case in point: We've spotted 2 warning signs for Aditya Birla Money you should be aware of, and 1 of them makes us a bit uncomfortable.

Of course Aditya Birla Money may not be the best stock to buy. So you may wish to see this free collection of growth stocks.

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.