Can You Imagine How Daihan PharmaceuticalLtd's (KOSDAQ:023910) Shareholders Feel About The 34% Share Price Increase?

When you buy and hold a stock for the long term, you definitely want it to provide a positive return. Better yet, you'd like to see the share price move up more than the market average. Unfortunately for shareholders, while the Daihan Pharmaceutical Co.,Ltd. (KOSDAQ:023910) share price is up 34% in the last five years, that's less than the market return. Meanwhile, the last twelve months saw the share price rise 3.3%.

Check out our latest analysis for Daihan PharmaceuticalLtd

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 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.

Over half a decade, Daihan PharmaceuticalLtd managed to grow its earnings per share at 16% a year. The EPS growth is more impressive than the yearly share price gain of 6% 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 7.41.

The graphic below depicts how EPS has changed over time (unveil the exact values by clicking on the image).

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

What about the Total Shareholder Return (TSR)?

We've already covered Daihan PharmaceuticalLtd's share price action, but we should also mention its 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. Dividends have been really beneficial for Daihan PharmaceuticalLtd shareholders, and that cash payout contributed to why its TSR of 41%, over the last 5 years, is better than the share price return.

A Different Perspective

Daihan PharmaceuticalLtd shareholders gained a total return of 4.7% during the year. But that return falls short of the market. If we look back over five years, the returns are even better, coming in at 7% per year for five years. It may well be that this is a business worth popping on the watching, given the continuing positive reception, over time, from the market. Before forming an opinion on Daihan PharmaceuticalLtd you might want to consider these 3 valuation metrics.

Of course Daihan PharmaceuticalLtd may not be the best stock to buy. So you may wish to see this free collection of growth stocks.

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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