How Much Did Cairo Communication's(BIT:CAI) Shareholders Earn From Share Price Movements Over The Last Five Years?

We think intelligent long term investing is the way to go. But that doesn't mean long term investors can avoid big losses. For example the Cairo Communication S.p.A. (BIT:CAI) share price dropped 71% over five years. That's not a lot of fun for true believers. We also note that the stock has performed poorly over the last year, with the share price down 47%. But it's up 8.3% in the last week.

View our latest analysis for Cairo Communication

To paraphrase Benjamin Graham: Over the short term the market is a voting machine, but over the long term it's a weighing machine. 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.

What about the Total Shareholder Return (TSR)?

Investors should note that there's a difference between Cairo Communication's total shareholder return (TSR) and its share price change, which we've covered above. 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. Its history of dividend payouts mean that Cairo Communication's TSR, which was a 66% drop over the last 5 years, was not as bad as the share price return.

A Different Perspective

While the broader market lost about 8.6% in the twelve months, Cairo Communication shareholders did even worse, losing 47%. 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 11% 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 Cairo Communication better, we need to consider many other factors. Consider risks, for instance. Every company has them, and we've spotted 2 warning signs for Cairo Communication you should know about.

If you like to buy stocks alongside management, then you might just love this free list of companies. (Hint: insiders have been buying them).

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