PJ Metal's (KOSDAQ:128660) earnings growth rate lags the 16% CAGR delivered to shareholders

It's been a soft week for PJ Metal Co., Ltd. (KOSDAQ:128660) shares, which are down 10%. On the bright side the returns have been quite good over the last half decade. After all, the share price is up a market-beating 72% in that time.

Since the long term performance has been good but there's been a recent pullback of 10%, let's check if the fundamentals match the share price.

Check out our latest analysis for PJ Metal

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, PJ Metal achieved compound earnings per share (EPS) growth of 19% per year. The EPS growth is more impressive than the yearly share price gain of 11% over the same period. So one could conclude that the broader market has become more cautious towards the stock. This cautious sentiment is reflected in its (fairly low) P/E ratio of 7.37.

The company's earnings per share (over time) is depicted in the image below (click to see the exact numbers).

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

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. It's fair to say that the TSR gives a more complete picture for stocks that pay a dividend. We note that for PJ Metal the TSR over the last 5 years was 111%, which is better than the share price return mentioned above. The dividends paid by the company have thusly boosted the total shareholder return.

A Different Perspective

We're pleased to report that PJ Metal shareholders have received a total shareholder return of 11% over one year. That's including the dividend. However, the TSR over five years, coming in at 16% per year, is even more impressive. It's always interesting to track share price performance over the longer term. But to understand PJ Metal better, we need to consider many other factors. Take risks, for example - PJ Metal has 8 warning signs (and 3 which don't sit too well with us) we think you should know about.

We will like PJ Metal better if we see some big insider buys. While we wait, check out this free list of undervalued stocks (mostly small caps) 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 South Korean 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.