Restaurant Brands New Zealand (NZSE:RBD) delivers shareholders splendid 27% CAGR over 5 years, surging 6.1% in the last week alone

The most you can lose on any stock (assuming you don't use leverage) is 100% of your money. But when you pick a company that is really flourishing, you can make more than 100%. Long term Restaurant Brands New Zealand Limited (NZSE:RBD) shareholders would be well aware of this, since the stock is up 213% in five years. And in the last week the share price has popped 6.1%.

Since the stock has added NZ$114m to its market cap in the past week alone, let's see if underlying performance has been driving long-term returns.

Check out our latest analysis for Restaurant Brands New Zealand

To paraphrase Benjamin Graham: Over the short term the market is a voting machine, but over the long term it's a weighing machine. 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 five years of share price growth, Restaurant Brands New Zealand actually saw its EPS drop 100% per year.

Essentially, it doesn't seem likely that investors are focused on EPS. Because earnings per share don't seem to match up with the share price, we'll take a look at other metrics instead.

In contrast revenue growth of 16% per year is probably viewed as evidence that Restaurant Brands New Zealand is growing, a real positive. In that case, the company may be sacrificing current earnings per share to drive growth.

The company's revenue and earnings (over time) are depicted in the image below (click to see the exact numbers).

We consider it positive that insiders have made significant purchases in the last year. Even so, future earnings will be far more important to whether current shareholders make money. You can see what analysts are predicting for Restaurant Brands New Zealand in this interactive graph of future profit estimates.

What about the Total Shareholder Return (TSR)?

Investors should note that there's a difference between Restaurant Brands New Zealand's total shareholder return (TSR) and its share price change, which we've covered above. The TSR attempts to capture the value of dividends (as if they were reinvested) as well as any spin-offs or discounted capital raisings offered to shareholders. Its history of dividend payouts mean that Restaurant Brands New Zealand's TSR of 236% over the last 5 years is better than the share price return.

A Different Perspective

We're pleased to report that Restaurant Brands New Zealand shareholders have received a total shareholder return of 31% over one year. That gain is better than the annual TSR over five years, which is 27%. Therefore it seems like sentiment around the company has been positive lately. 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 Restaurant Brands New Zealand better, we need to consider many other factors. To that end, you should be aware of the 1 warning sign we've spotted with Restaurant Brands New Zealand .

Restaurant Brands New Zealand 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 NZ 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.