If You Had Bought Yuhwa Securitiesltd's (KRX:003460) Shares Three Years Ago You Would Be Down 24%

For many investors, the main point of stock picking is to generate higher returns than the overall market. But in any portfolio, there are likely to be some stocks that fall short of that benchmark. Unfortunately, that's been the case for longer term Yuhwa Securities co.,ltd. (KRX:003460) shareholders, since the share price is down 24% in the last three years, falling well short of the market return of around 28%. The silver lining is that the stock is up 1.1% in about a week.

See our latest analysis for Yuhwa Securitiesltd

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. 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.

During the three years that the share price fell, Yuhwa Securitiesltd's earnings per share (EPS) dropped by 15% each year. In comparison the 9% compound annual share price decline isn't as bad as the EPS drop-off. So the market may not be too worried about the EPS figure, at the moment -- or it may have previously priced some of the drop in.

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

Before buying or selling a stock, we always recommend a close examination of historic growth trends, available here.

What about the Total Shareholder Return (TSR)?

We'd be remiss not to mention the difference between Yuhwa Securitiesltd'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 Yuhwa Securitiesltd shareholders, and that cash payout explains why its total shareholder loss of 11%, over the last 3 years, isn't as bad as the share price return.

A Different Perspective

Yuhwa Securitiesltd shareholders are up 2.0% for the year. Unfortunately this falls short of the market return. On the bright side, that's still a gain, and it's actually better than the average return of 0.6% over half a decade This could indicate that the company is winning over new investors, as it pursues its strategy. It's always interesting to track share price performance over the longer term. But to understand Yuhwa Securitiesltd better, we need to consider many other factors. For instance, we've identified 3 warning signs for Yuhwa Securitiesltd (2 don't sit too well with us) that you should be aware of.

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 KR 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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