The Cerespo (TYO:9625) Share Price Has Gained 73% And Shareholders Are Hoping For More

The Cerespo Co., Ltd. (TYO:9625) share price is down a rather concerning 47% in the last month. But that doesn't change the fact that the returns over the last five years have been pleasing. It has returned a market beating 73% in that time.

View our latest analysis for Cerespo

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

During five years of share price growth, Cerespo achieved compound earnings per share (EPS) growth of 37% per year. This EPS growth is higher than the 12% average annual increase in the share price. So it seems the market isn't so enthusiastic about the stock these days. This cautious sentiment is reflected in its (fairly low) P/E ratio of 2.89.

You can see how EPS has changed over time in the image below (click on the chart to see the exact values).

This free interactive report on Cerespo's earnings, revenue and cash flow is a great place to start, if you want to investigate the stock further.

What about the Total Shareholder Return (TSR)?

We'd be remiss not to mention the difference between Cerespo's total shareholder return (TSR) and its share price return. The TSR attempts to capture the value of dividends (as if they were reinvested) as well as any spin-offs or discounted capital raisings offered to shareholders. Dividends have been really beneficial for Cerespo shareholders, and that cash payout contributed to why its TSR of 101%, over the last 5 years, is better than the share price return.

A Different Perspective

We're pleased to report that Cerespo shareholders have received a total shareholder return of 14% over one year. However, the TSR over five years, coming in at 15% per year, is even more impressive. It's always interesting to track share price performance over the longer term. But to understand Cerespo better, we need to consider many other factors. Take risks, for example - Cerespo has 3 warning signs (and 1 which shouldn't be ignored) we think you should know about.

If you would prefer to check out another company -- one with potentially superior financials -- then do not miss this free list of companies that have proven they can grow earnings.

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

If you spot an error that warrants correction, please contact the editor at editorial-team@simplywallst.com. 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. Simply Wall St has no position in the stocks mentioned.

We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Thank you for reading.