The Pearl Abyss (KOSDAQ:263750) Share Price Has Gained 78% And Shareholders Are Hoping For More

One simple way to benefit from the stock market is to buy an index fund. But if you pick the right individual stocks, you could make more than that. Just take a look at Pearl Abyss Corp. (KOSDAQ:263750), which is up 78%, over three years, soundly beating the market return of 1.0% (not including dividends).

See our latest analysis for Pearl Abyss

To quote Buffett, 'Ships will sail around the world but the Flat Earth Society will flourish. There will continue to be wide discrepancies between price and value in the marketplace...' 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 three years of share price growth, Pearl Abyss achieved compound earnings per share growth of 34% per year. The average annual share price increase of 21% is actually lower than the EPS growth. Therefore, it seems the market has moderated its expectations for growth, somewhat.

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

It is of course excellent to see how Pearl Abyss has grown profits over the years, but the future is more important for shareholders. This free interactive report on Pearl Abyss' balance sheet strength is a great place to start, if you want to investigate the stock further.

A Different Perspective

Pearl Abyss shareholders are down 1.6% for the year, but the broader market is up 20%. However, keep in mind that even the best stocks will sometimes underperform the market over a twelve month period. Investors are up over three years, booking 21% per year, much better than the more recent returns. The recent sell-off could be an opportunity if the business remains sound, so it may be worth checking the fundamental data for signs of a long-term growth trend. Is Pearl Abyss cheap compared to other companies? These 3 valuation measures might help you decide.

We will like Pearl Abyss 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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