The 11% return this week takes Entertainment Network (India)'s (NSE:ENIL) shareholders one-year gains to 95%

These days it's easy to simply buy an index fund, and your returns should (roughly) match the market. But investors can boost returns by picking market-beating companies to own shares in. For example, the Entertainment Network (India) Limited (NSE:ENIL) share price is up 94% in the last 1 year, clearly besting the market return of around 46% (not including dividends). So that should have shareholders smiling. Looking back further, the stock price is 44% higher than it was three years ago.

Since the stock has added ₹1.2b to its market cap in the past week alone, let's see if underlying performance has been driving long-term returns.

See our latest analysis for Entertainment Network (India)

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.

Entertainment Network (India) went from making a loss to reporting a profit, in the last year.

When a company is just on the edge of profitability it can be well worth considering other metrics in order to more precisely gauge growth (and therefore understand share price movements).

We doubt the modest 0.6% dividend yield is doing much to support the share price. However the year on year revenue growth of 22% would help. Many businesses do go through a phase where they have to forgo some profits to drive business development, and sometimes its for the best.

The graphic below depicts how earnings and revenue have changed over time (unveil the exact values by clicking on the image).

We know that Entertainment Network (India) has improved its bottom line over the last three years, but what does the future have in store? Take a more thorough look at Entertainment Network (India)'s financial health with this free report on its balance sheet.

A Different Perspective

We're pleased to report that Entertainment Network (India) shareholders have received a total shareholder return of 95% over one year. That's including the dividend. There's no doubt those recent returns are much better than the TSR loss of 7% per year over five years. We generally put more weight on the long term performance over the short term, but the recent improvement could hint at a (positive) inflection point within the business. Is Entertainment Network (India) cheap compared to other companies? These 3 valuation measures might help you decide.

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 Indian exchanges.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.

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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com