Investing in stocks inevitably means buying into some companies that perform poorly. But the last three years have been particularly tough on longer term MGB Berhad (KLSE:MGB) shareholders. So they might be feeling emotional about the 64% share price collapse, in that time. The falls have accelerated recently, with the share price down 18% in the last three months. We note that the company has reported results fairly recently; and the market is hardly delighted. You can check out the latest numbers in our company report.
View our latest analysis for MGB Berhad
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.
MGB Berhad saw its EPS decline at a compound rate of 34% per year, over the last three years. This change in EPS is reasonably close to the 29% average annual decrease in the share price. So it seems that investor expectations of the company are staying pretty steady, despite the disappointment. In this case, it seems that the EPS is guiding the share price.
You can see how EPS has changed over time in the image below (click on the chart to see the exact values).
Dive deeper into MGB Berhad's key metrics by checking this interactive graph of MGB Berhad's earnings, revenue and cash flow.
A Different Perspective
The last twelve months weren't great for MGB Berhad shares, which cost holders 2.3%, while the market was up about 8.6%. Of course the long term matters more than the short term, and even great stocks will sometimes have a poor year. However, the loss over the last year isn't as bad as the 18% per annum loss investors have suffered over the last three years. We would want clear information suggesting the company will grow, before taking the view that the share price will stabilize. It's always interesting to track share price performance over the longer term. But to understand MGB Berhad better, we need to consider many other factors. To that end, you should be aware of the 2 warning signs we've spotted with MGB Berhad .
If you like to buy stocks alongside management, then you might just love this free list of companies. (Hint: insiders have been buying them).
Please note, the market returns quoted in this article reflect the market weighted average returns of stocks that currently trade on MY 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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About KLSE:MGB
MGB Berhad
An investment holding company, operates as a construction and development company in Malaysia.
Flawless balance sheet and undervalued.
