GeeCee Ventures' (NSE:GEECEE) one-year earnings growth trails the impressive shareholder returns

By
Simply Wall St
Published
February 18, 2022
NSEI:GEECEE
Source: Shutterstock

Unfortunately, investing is risky - companies can and do go bankrupt. But if you pick the right stock, you can make a lot more than 100%. Take, for example GeeCee Ventures Limited (NSE:GEECEE). Its share price is already up an impressive 106% in the last twelve months. It's also good to see the share price up 31% over the last quarter. The company reported its financial results recently; you can catch up on the latest numbers by reading our company report. Also impressive, the stock is up 81% over three years, making long term shareholders happy, too.

On the back of a solid 7-day performance, let's check what role the company's fundamentals have played in driving long term shareholder returns.

Check out our latest analysis for GeeCee Ventures

While the efficient markets hypothesis continues to be taught by some, it has been proven that markets are over-reactive dynamic systems, and investors are not always rational. 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.

GeeCee Ventures was able to grow EPS by 99% in the last twelve months. We note that the earnings per share growth isn't far from the share price growth (of 106%). So this implies that investor expectations of the company have remained pretty steady. It looks like the share price is responding to the EPS.

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

earnings-per-share-growth
NSEI:GEECEE Earnings Per Share Growth February 18th 2022

We consider it positive that insiders have made significant purchases in the last year. Even so, future earnings will be far more important to whether current shareholders make money. Dive deeper into the earnings by checking this interactive graph of GeeCee Ventures' earnings, revenue and cash flow.

What About Dividends?

It is important to consider the total shareholder return, as well as the share price return, for any given stock. 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. So for companies that pay a generous dividend, the TSR is often a lot higher than the share price return. As it happens, GeeCee Ventures' TSR for the last 1 year was 108%, 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

We're pleased to report that GeeCee Ventures shareholders have received a total shareholder return of 108% over one year. And that does include the dividend. That's better than the annualised return of 9% 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 GeeCee Ventures better, we need to consider many other factors. Take risks, for example - GeeCee Ventures has 5 warning signs (and 1 which is a bit unpleasant) we think you should know about.

GeeCee Ventures is not the only stock that insiders are buying. 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 IN exchanges.

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