Asian Pay Television Trust (SGX:S7OU) Share Prices Have Dropped 81% In The Last Five Years

We think intelligent long term investing is the way to go. But that doesn't mean long term investors can avoid big losses. To wit, the Asian Pay Television Trust (SGX:S7OU) share price managed to fall 81% over five long years. That is extremely sub-optimal, to say the least.

While a drop like that is definitely a body blow, money isn't as important as health and happiness.

Check out our latest analysis for Asian Pay Television Trust

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 imperfect but simple way to consider how the market perception of a company has shifted is to compare the change in the earnings per share (EPS) with the share price movement.

During the five years over which the share price declined, Asian Pay Television Trust's earnings per share (EPS) dropped by 20% each year. Readers should note that the share price has fallen faster than the EPS, at a rate of 29% per year, over the period. This implies that the market was previously too optimistic about the stock. The less favorable sentiment is reflected in its current P/E ratio of 10.09.

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

Dive deeper into Asian Pay Television Trust's key metrics by checking this interactive graph of Asian Pay Television Trust's earnings, revenue and cash flow.

What About Dividends?

As well as measuring the share price return, investors should also consider the total shareholder return (TSR). Whereas the share price return only reflects the change in the share price, the TSR includes the value of dividends (assuming they were reinvested) and the benefit of any discounted capital raising or spin-off. So for companies that pay a generous dividend, the TSR is often a lot higher than the share price return. As it happens, Asian Pay Television Trust's TSR for the last 5 years was -66%, which exceeds the share price return mentioned earlier. The dividends paid by the company have thusly boosted the total shareholder return.

A Different Perspective

Asian Pay Television Trust shareholders are down 4.9% for the year (even including dividends), but the market itself is up 21%. However, keep in mind that even the best stocks will sometimes underperform the market over a twelve month period. Unfortunately, longer term shareholders are suffering worse, given the loss of 11% doled out over the last five years. We'd need to see some sustained improvements in the key metrics before we could muster much enthusiasm. 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. For example, we've discovered 3 warning signs for Asian Pay Television Trust (1 is significant!) that you should be aware of before investing here.

If you like to buy stocks alongside management, then you might just love this free list of companies. (Hint: insiders have been buying them).

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