S.N.T.G.N. Transgaz's (BVB:TGN) 98% YoY earnings expansion surpassed the shareholder returns over the past year

Passive investing in index funds can generate returns that roughly match the overall market. But you can significantly boost your returns by picking above-average stocks. For example, the S.N.T.G.N. Transgaz S.A. (BVB:TGN) share price is up 58% in the last 1 year, clearly besting the market decline of around 3.3% (not including dividends). That's a solid performance by our standards! And shareholders have also done well over the long term, with an increase of 47% in the last three years.

The past week has proven to be lucrative for S.N.T.G.N. Transgaz investors, so let's see if fundamentals drove the company's one-year performance.

View our latest analysis for S.N.T.G.N. Transgaz

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. 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.

S.N.T.G.N. Transgaz was able to grow EPS by 98% in the last twelve months. It's fair to say that the share price gain of 58% did not keep pace with the EPS growth. Therefore, it seems the market isn't as excited about S.N.T.G.N. Transgaz as it was before. This could be an opportunity.

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

We know that S.N.T.G.N. Transgaz has improved its bottom line lately, but is it going to grow revenue? You could check out this free report showing analyst revenue forecasts.

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. Arguably, the TSR gives a more comprehensive picture of the return generated by a stock. In the case of S.N.T.G.N. Transgaz, it has a TSR of 68% for the last 1 year. That exceeds its share price return that we previously mentioned. This is largely a result of its dividend payments!

A Different Perspective

It's good to see that S.N.T.G.N. Transgaz has rewarded shareholders with a total shareholder return of 68% in the last twelve months. And that does include the dividend. Since the one-year TSR is better than the five-year TSR (the latter coming in at 6% per year), it would seem that the stock's performance has improved in recent times. Someone with an optimistic perspective could view the recent improvement in TSR as indicating that the business itself is getting better with time. It's always interesting to track share price performance over the longer term. But to understand S.N.T.G.N. Transgaz better, we need to consider many other factors. Case in point: We've spotted 1 warning sign for S.N.T.G.N. Transgaz you should be aware of.

If you are like me, then you will not want to miss this free list of growing companies that insiders are buying.

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