Earnings grew faster than the decent 18% CAGR delivered to Bliss GVS Pharma (NSE:BLISSGVS) shareholders over the last three years

Bliss GVS Pharma Limited (NSE:BLISSGVS) shareholders have seen the share price descend 22% over the month. But don't let that distract from the very nice return generated over three years. To wit, the share price did better than an index fund, climbing 62% during that period.

Since the long term performance has been good but there's been a recent pullback of 16%, let's check if the fundamentals match the share price.

Check out our latest analysis for Bliss GVS Pharma

While markets are a powerful pricing mechanism, share prices reflect investor sentiment, not just underlying business performance. 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.

Bliss GVS Pharma was able to grow its EPS at 229% per year over three years, sending the share price higher. This EPS growth is higher than the 17% average annual increase in the share price. So one could reasonably conclude that the market has cooled on the stock.

The image below shows how EPS has tracked over time (if you click on the image you can see greater detail).

It might be well worthwhile taking a look at our free report on Bliss GVS Pharma's earnings, revenue and cash flow.

What About Dividends?

When looking at investment returns, it is important to consider the difference between total shareholder return (TSR) and share price return. Whereas the share price return only reflects the change in the share price, the TSR includes the value of dividends (assuming they were reinvested) and the benefit of any discounted capital raising or spin-off. It's fair to say that the TSR gives a more complete picture for stocks that pay a dividend. We note that for Bliss GVS Pharma the TSR over the last 3 years was 65%, which is better than the share price return mentioned above. And there's no prize for guessing that the dividend payments largely explain the divergence!

A Different Perspective

We regret to report that Bliss GVS Pharma shareholders are down 4.4% for the year (even including dividends). Unfortunately, that's worse than the broader market decline of 0.1%. 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. Unfortunately, last year's performance may indicate unresolved challenges, given that it was worse than the annualised loss of 1.2% over the last half decade. We realise that Baron Rothschild has said investors should "buy when there is blood on the streets", but we caution that investors should first be sure they are buying a high quality business. It's always interesting to track share price performance over the longer term. But to understand Bliss GVS Pharma better, we need to consider many other factors. Take risks, for example - Bliss GVS Pharma has 5 warning signs (and 2 which shouldn't be ignored) we think you should know about.

But note: Bliss GVS Pharma 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 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.