Even though Skylark Holdings (TSE:3197) has lost JP¥23b market cap in last 7 days, shareholders are still up 63% over 3 years

One simple way to benefit from the stock market is to buy an index fund. But many of us dare to dream of bigger returns, and build a portfolio ourselves. Just take a look at Skylark Holdings Co., Ltd. (TSE:3197), which is up 61%, over three years, soundly beating the market return of 33% (not including dividends). However, more recent returns haven't been as impressive as that, with the stock returning just 2.4% in the last year, including dividends.

While the stock has fallen 4.2% this week, it's worth focusing on the longer term and seeing if the stocks historical returns have been driven by the underlying fundamentals.

Check out our latest analysis for Skylark Holdings

There is no denying that markets are sometimes efficient, but prices do not always reflect underlying business performance. One flawed but reasonable way to assess how sentiment around a company has changed is to compare the earnings per share (EPS) with the share price.

Skylark Holdings became profitable within the last three years. That would generally be considered a positive, so we'd expect the share price to be up.

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

We know that Skylark Holdings has improved its bottom line lately, but is it going to grow revenue? You could check out this free report showing analyst revenue forecasts.

A Different Perspective

Skylark Holdings shareholders gained a total return of 2.4% during the year. But that return falls short of the market. On the bright side, that's still a gain, and it's actually better than the average return of 1.8% over half a decade This could indicate that the company is winning over new investors, as it pursues its strategy. Is Skylark Holdings cheap compared to other companies? These 3 valuation measures might help you decide.

But note: Skylark Holdings 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 Japanese 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.