How Much Did Hyundai Home Shopping Network's(KRX:057050) Shareholders Earn From Share Price Movements Over The Last Three Years?

Hyundai Home Shopping Network Corporation (KRX:057050) shareholders should be happy to see the share price up 20% in the last quarter. But that cannot eclipse the less-than-impressive returns over the last three years. In fact, the share price is down 40% in the last three years, falling well short of the market return.

Check out our latest analysis for Hyundai Home Shopping Network

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 the three years that the share price fell, Hyundai Home Shopping Network's earnings per share (EPS) dropped by 14% each year. This fall in EPS isn't far from the rate of share price decline, which was 16% per year. So it seems like sentiment towards the stock hasn't changed all that much over time. Rather, the share price has approximately tracked EPS growth.

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

Before buying or selling a stock, we always recommend a close examination of historic growth trends, available here.

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 Hyundai Home Shopping Network the TSR over the last 3 years was -36%, which is better than the share price return mentioned above. This is largely a result of its dividend payments!

A Different Perspective

Hyundai Home Shopping Network shareholders are down 6.7% for the year (even including dividends), but the market itself is up 35%. However, keep in mind that even the best stocks will sometimes underperform the market over a twelve month period. Regrettably, last year's performance caps off a bad run, with the shareholders facing a total loss of 5% per year over five years. Generally speaking long term share price weakness can be a bad sign, though contrarian investors might want to research the stock in hope of a turnaround. While it is well worth considering the different impacts that market conditions can have on the share price, there are other factors that are even more important. Consider for instance, the ever-present spectre of investment risk. We've identified 2 warning signs with Hyundai Home Shopping Network , and understanding them should be part of your investment process.

If you would prefer to check out another company -- one with potentially superior financials -- then do not miss this free list of companies that have proven they can grow earnings.

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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