Dar Al Arkan Real Estate Development's (TADAWUL:4300) five-year earnings growth trails the 19% YoY shareholder returns

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%. Long term Dar Al Arkan Real Estate Development Company (TADAWUL:4300) shareholders would be well aware of this, since the stock is up 143% in five years. On top of that, the share price is up 31% in about a quarter.

Since the stock has added ر.س1.0b 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 Dar Al Arkan Real Estate Development

To quote Buffett, 'Ships will sail around the world but the Flat Earth Society will flourish. There will continue to be wide discrepancies between price and value in the marketplace...' One flawed but reasonable way to assess how sentiment around a company has changed is to compare the earnings per share (EPS) with the share price.

Over half a decade, Dar Al Arkan Real Estate Development managed to grow its earnings per share at 19% a year. That makes the EPS growth particularly close to the yearly share price growth of 19%. This indicates that investor sentiment towards the company has not changed a great deal. Indeed, it would appear the share price is reacting to the EPS.

You can see below how EPS has changed over time (discover the exact values by clicking on the image).

We know that Dar Al Arkan Real Estate Development has improved its bottom line over the last three years, but what does the future have in store? Take a more thorough look at Dar Al Arkan Real Estate Development's financial health with this free report on its balance sheet.

A Different Perspective

We're pleased to report that Dar Al Arkan Real Estate Development shareholders have received a total shareholder return of 29% over one year. That gain is better than the annual TSR over five years, which is 19%. 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. Before forming an opinion on Dar Al Arkan Real Estate Development you might want to consider these 3 valuation metrics.

Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of companies we expect will grow earnings.

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