Shareholders 49% loss in Tokyo Electric Power Company Holdings (TSE:9501) partly attributable to the company's decline in earnings over past year

Tokyo Electric Power Company Holdings, Incorporated (TSE:9501) shareholders should be happy to see the share price up 16% in the last month. But in truth the last year hasn't been good for the share price. After all, the share price is down 49% in the last year, significantly under-performing the market.

The recent uptick of 3.6% could be a positive sign of things to come, so let's take a look at historical fundamentals.

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 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.

Unhappily, Tokyo Electric Power Company Holdings had to report a 82% decline in EPS over the last year. This fall in the EPS is significantly worse than the 49% the share price fall. It may have been that the weak EPS was not as bad as some had feared.

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

We know that Tokyo Electric Power Company Holdings has improved its bottom line over the last three years, but what does the future have in store? Take a more thorough look at Tokyo Electric Power Company Holdings' financial health with this free report on its balance sheet.

A Different Perspective

While the broader market gained around 1.8% in the last year, Tokyo Electric Power Company Holdings shareholders lost 49%. However, keep in mind that even the best stocks will sometimes underperform the market over a twelve month period. On the bright side, long term shareholders have made money, with a gain of 4% per year over half a decade. It could be that the recent sell-off is an opportunity, so it may be worth checking the fundamental data for signs of a long term growth trend. I find it very interesting to look at share price over the long term as a proxy for business performance. But to truly gain insight, we need to consider other information, too. Even so, be aware that Tokyo Electric Power Company Holdings is showing 3 warning signs in our investment analysis , and 1 of those can't be ignored...

Of course Tokyo Electric Power Company Holdings may not be the best stock to buy. So you may wish to see this free collection of growth stocks.

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.