Islamic Holding Group (Q.P.S.C)'s (DSM:IHGS) 70% YoY earnings expansion surpassed the shareholder returns over the past three years

The worst result, after buying shares in a company (assuming no leverage), would be if you lose all the money you put in. But when you pick a company that is really flourishing, you can make more than 100%. To wit, the Islamic Holding Group (Q.P.S.C) (DSM:IHGS) share price has flown 138% in the last three years. That sort of return is as solid as granite. Better yet, the share price has risen 11% in the last week. But this could be related to the buoyant market which is up about 5.0% in a week.

Since the stock has added ر.ق33m to its market cap in the past week alone, let's see if underlying performance has been driving long-term returns.

View our latest analysis for Islamic Holding Group (Q.P.S.C)

While markets are a powerful pricing mechanism, share prices reflect investor sentiment, not just 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.

Islamic Holding Group (Q.P.S.C) was able to grow its EPS at 387% per year over three years, sending the share price higher. This EPS growth is higher than the 34% average annual increase in the share price. Therefore, it seems the market has moderated its expectations for growth, somewhat.

The image below shows how EPS has tracked over time (if you click on the image you can see greater detail).

Dive deeper into Islamic Holding Group (Q.P.S.C)'s key metrics by checking this interactive graph of Islamic Holding Group (Q.P.S.C)'s earnings, revenue and cash flow.

What About Dividends?

It is important to consider the total shareholder return, as well as the share price return, for any given stock. The TSR incorporates the value of any spin-offs or discounted capital raisings, along with any dividends, based on the assumption that the dividends are reinvested. It's fair to say that the TSR gives a more complete picture for stocks that pay a dividend. We note that for Islamic Holding Group (Q.P.S.C) the TSR over the last 3 years was 143%, which is better than the share price return mentioned above. The dividends paid by the company have thusly boosted the total shareholder return.

A Different Perspective

Islamic Holding Group (Q.P.S.C)'s TSR for the year was broadly in line with the market average, at 16%. That gain looks pretty satisfying, and it is even better than the five-year TSR of 2% per year. Even if the share price growth slows down from here, there's a good chance that this is business worth watching in the long term. It's always interesting to track share price performance over the longer term. But to understand Islamic Holding Group (Q.P.S.C) better, we need to consider many other factors. To that end, you should be aware of the 3 warning signs we've spotted with Islamic Holding Group (Q.P.S.C) .

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 QA 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.