How Much Did SIF Oltenia's(BVB:SIF5) Shareholders Earn From Share Price Movements Over The Last Year?

The simplest way to benefit from a rising market is to buy an index fund. Active investors aim to buy stocks that vastly outperform the market - but in the process, they risk under-performance. That downside risk was realized by SIF Oltenia (BVB:SIF5) shareholders over the last year, as the share price declined 29%. That's disappointing when you consider the market declined 2.9%. However, the longer term returns haven't been so bad, with the stock down 16% in the last three years. It's up 1.1% in the last seven days.

See our latest analysis for SIF Oltenia

In his essay The Superinvestors of Graham-and-Doddsville Warren Buffett described how share prices do not always rationally reflect the value of a business. One way to examine how market sentiment has changed over time is to look at the interaction between a company's share price and its earnings per share (EPS).

Unfortunately SIF Oltenia reported an EPS drop of 71% for the last year. This fall in the EPS is significantly worse than the 29% the share price fall. So despite the weak per-share profits, some investors are probably relieved the situation wasn't more difficult.

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

Dive deeper into SIF Oltenia's key metrics by checking this interactive graph of SIF Oltenia's earnings, revenue and cash flow.

What about the Total Shareholder Return (TSR)?

We've already covered SIF Oltenia's share price action, but we should also mention its total shareholder return (TSR). The TSR is a return calculation that accounts for the value of cash dividends (assuming that any dividend received was reinvested) and the calculated value of any discounted capital raisings and spin-offs. Dividends have been really beneficial for SIF Oltenia shareholders, and that cash payout explains why its total shareholder loss of 25%, over the last year, isn't as bad as the share price return.

A Different Perspective

While the broader market lost about 2.9% in the twelve months, SIF Oltenia shareholders did even worse, losing 25%. Having said that, it's inevitable that some stocks will be oversold in a falling market. The key is to keep your eyes on the fundamental developments. Longer term investors wouldn't be so upset, since they would have made 7%, each year, over five years. If the fundamental data continues to indicate long term sustainable growth, the current sell-off could be an opportunity worth considering. 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. Like risks, for instance. Every company has them, and we've spotted 2 warning signs for SIF Oltenia (of which 1 shouldn't be ignored!) you should know about.

We will like SIF Oltenia better if we see some big insider buys. While we wait, check out this free list of growing companies with considerable, recent, insider buying.

Please note, the market returns quoted in this article reflect the market weighted average returns of stocks that currently trade on RO 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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