Stock Analysis

Did You Participate In Any Of Asia Paper Manufacturing.Co.Ltd's (KRX:002310) Fantastic 181% Return ?

KOSE:A002310
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The most you can lose on any stock (assuming you don't use leverage) is 100% of your money. But on a lighter note, a good company can see its share price rise well over 100%. Long term Asia Paper Manufacturing.Co.,Ltd (KRX:002310) shareholders would be well aware of this, since the stock is up 156% in five years. Also pleasing for shareholders was the 12% gain in the last three months. But this could be related to the strong market, which is up 9.7% in the last three months.

Check out our latest analysis for Asia Paper Manufacturing.Co.Ltd

While markets are a powerful pricing mechanism, share prices reflect investor sentiment, not just underlying business performance. 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.

Over half a decade, Asia Paper Manufacturing.Co.Ltd managed to grow its earnings per share at 85% a year. The EPS growth is more impressive than the yearly share price gain of 21% over the same period. So it seems the market isn't so enthusiastic about the stock these days. The reasonably low P/E ratio of 8.33 also suggests market apprehension.

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

earnings-per-share-growth
KOSE:A002310 Earnings Per Share Growth March 5th 2021

Dive deeper into Asia Paper Manufacturing.Co.Ltd's key metrics by checking this interactive graph of Asia Paper Manufacturing.Co.Ltd's earnings, revenue and cash flow.

What About Dividends?

As well as measuring the share price return, investors should also consider the total shareholder return (TSR). The TSR is a return calculation that accounts for the value of cash dividends (assuming that any dividend received was reinvested) and the calculated value of any discounted capital raisings and spin-offs. Arguably, the TSR gives a more comprehensive picture of the return generated by a stock. As it happens, Asia Paper Manufacturing.Co.Ltd's TSR for the last 5 years was 181%, which exceeds the share price return mentioned earlier. And there's no prize for guessing that the dividend payments largely explain the divergence!

A Different Perspective

Asia Paper Manufacturing.Co.Ltd provided a TSR of 42% over the last twelve months. But that return falls short of the market. The silver lining is that the gain was actually better than the average annual return of 23% 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 Asia Paper Manufacturing.Co.Ltd better, we need to consider many other factors. To that end, you should be aware of the 2 warning signs we've spotted with Asia Paper Manufacturing.Co.Ltd .

But note: Asia Paper Manufacturing.Co.Ltd may not be the best stock to buy. So take a peek at this free list of interesting companies with past earnings growth (and further growth forecast).

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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