Shareholders Of Pungguk Ethanol Industrial (KOSDAQ:023900) Must Be Happy With Their 241% Total Return

The worst result, after buying shares in a company (assuming no leverage), would be if you lose all the money you put in. But when you pick a company that is really flourishing, you can make more than 100%. For instance, the price of Pungguk Ethanol Industrial Co., Ltd (KOSDAQ:023900) stock is up an impressive 209% over the last five years.

Check out our latest analysis for Pungguk Ethanol Industrial

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 way to examine how market sentiment has changed over time is to look at the interaction between a company's share price and its earnings per share (EPS).

During five years of share price growth, Pungguk Ethanol Industrial actually saw its EPS drop 2.7% per year.

By glancing at these numbers, we'd posit that the decline in earnings per share is not representative of how the business has changed over the years. Therefore, it's worth taking a look at other metrics to try to understand the share price movements.

The modest 0.8% dividend yield is unlikely to be propping up the share price. In contrast revenue growth of 5.2% per year is probably viewed as evidence that Pungguk Ethanol Industrial is growing, a real positive. It's quite possible that management are prioritizing revenue growth over EPS growth at the moment.

The company's revenue and earnings (over time) are depicted in the image below (click to see the exact numbers).

If you are thinking of buying or selling Pungguk Ethanol Industrial stock, you should check out this FREE detailed report on its balance sheet.

What About Dividends?

As well as measuring the share price return, investors should also consider the total shareholder return (TSR). Whereas the share price return only reflects the change in the share price, the TSR includes the value of dividends (assuming they were reinvested) and the benefit of any discounted capital raising or spin-off. So for companies that pay a generous dividend, the TSR is often a lot higher than the share price return. We note that for Pungguk Ethanol Industrial the TSR over the last 5 years was 241%, which is better than the share price return mentioned above. This is largely a result of its dividend payments!

A Different Perspective

Pungguk Ethanol Industrial shareholders gained a total return of 32% during the year. But that was short of the market average. The silver lining is that the gain was actually better than the average annual return of 28% per year over five year. 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 Pungguk Ethanol Industrial better, we need to consider many other factors. Consider risks, for instance. Every company has them, and we've spotted 1 warning sign for Pungguk Ethanol Industrial you should know about.

We will like Pungguk Ethanol Industrial better if we see some big insider buys. While we wait, check out this free list of growing companies with considerable, recent, insider buying.

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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