Shareholders Of Van Lanschot Kempen (AMS:VLK) Must Be Happy With Their 88% Return

By
Simply Wall St
Published
July 19, 2021
Source: Shutterstock

It hasn't been the best quarter for Van Lanschot Kempen N.V. (AMS:VLK) shareholders, since the share price has fallen 14% in that time. On the bright side the share price is up over the last half decade. In that time, it is up 32%, which isn't bad, but is below the market return of 74%.

View our latest analysis for Van Lanschot Kempen

There is no denying that markets are sometimes efficient, but prices do not always reflect underlying business performance. 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 five years of share price growth, Van Lanschot Kempen achieved compound earnings per share (EPS) growth of 4.7% per year. This EPS growth is reasonably close to the 6% average annual increase in the share price. That suggests that the market sentiment around the company hasn't changed much over that time. Rather, the share price has approximately tracked EPS growth.

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

earnings-per-share-growth
ENXTAM:VLK Earnings Per Share Growth July 20th 2021

We like that insiders have been buying shares in the last twelve months. Having said that, most people consider earnings and revenue growth trends to be a more meaningful guide to the business. Before buying or selling a stock, we always recommend a close examination of historic growth trends, available here..

What About Dividends?

It is important to consider the total shareholder return, as well as the share price return, for any given stock. 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. In the case of Van Lanschot Kempen, it has a TSR of 88% for the last 5 years. That exceeds its share price return that we previously mentioned. The dividends paid by the company have thusly boosted the total shareholder return.

A Different Perspective

We're pleased to report that Van Lanschot Kempen shareholders have received a total shareholder return of 32% over one year. That's including the dividend. That's better than the annualised return of 13% over half a decade, implying that the company is doing better recently. In the best case scenario, this may hint at some real business momentum, implying that now could be a great time to delve deeper. It's always interesting to track share price performance over the longer term. But to understand Van Lanschot Kempen better, we need to consider many other factors. Consider risks, for instance. Every company has them, and we've spotted 1 warning sign for Van Lanschot Kempen you should know about.

Van Lanschot Kempen is not the only stock that insiders are buying. For those who like to find winning investments this free list of growing 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 NL exchanges.

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