Investors one-year returns in Daewoong Pharmaceutical (KRX:069620) have not grown faster than the company's underlying earnings growth

Passive investing in index funds can generate returns that roughly match the overall market. But if you pick the right individual stocks, you could make more than that. To wit, the Daewoong Pharmaceutical Co., Ltd (KRX:069620) share price is 21% higher than it was a year ago, much better than the market return of around 5.8% (not including dividends) in the same period. That's a solid performance by our standards! Zooming out, the stock is actually down 4.2% in the last three years.

While this past week has detracted from the company's one-year return, let's look at the recent trends of the underlying business and see if the gains have been in alignment.

See our latest analysis for Daewoong Pharmaceutical

There is no denying that markets are sometimes efficient, but prices do not always reflect underlying business performance. By comparing earnings per share (EPS) and share price changes over time, we can get a feel for how investor attitudes to a company have morphed over time.

During the last year Daewoong Pharmaceutical grew its earnings per share (EPS) by 72%. It's fair to say that the share price gain of 21% did not keep pace with the EPS growth. So it seems like the market has cooled on Daewoong Pharmaceutical, despite the growth. Interesting.

You can see below how EPS has changed over time (discover the exact values by clicking on the image).

We know that Daewoong Pharmaceutical has improved its bottom line over the last three years, but what does the future have in store? Take a more thorough look at Daewoong Pharmaceutical's financial health with this free report on its balance sheet.

A Different Perspective

We're pleased to report that Daewoong Pharmaceutical shareholders have received a total shareholder return of 22% over one year. And that does include the dividend. Notably the five-year annualised TSR loss of 1.5% per year compares very unfavourably with the recent share price performance. This makes us a little wary, but the business might have turned around its fortunes. It's always interesting to track share price performance over the longer term. But to understand Daewoong Pharmaceutical better, we need to consider many other factors. To that end, you should be aware of the 1 warning sign we've spotted with Daewoong Pharmaceutical .

For those who like to find winning investments this free list of undervalued companies with recent insider purchasing, could be just the ticket.

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.