Shareholders Of Parkway Life Real Estate Investment Trust (SGX:C2PU) Must Be Happy With Their 129% Total Return

When we invest, we're generally looking for stocks that outperform the market average. And in our experience, buying the right stocks can give your wealth a significant boost. To wit, the Parkway Life Real Estate Investment Trust share price has climbed 85% in five years, easily topping the market decline of 1.2% (ignoring dividends). On the other hand, the more recent gains haven't been so impressive, with shareholders gaining just 16% , including dividends .

See our latest analysis for Parkway Life Real Estate Investment 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. 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.

During five years of share price growth, Parkway Life Real Estate Investment Trust achieved compound earnings per share (EPS) growth of 5.4% per year. This EPS growth is lower than the 13% average annual increase in the share price. So it's fair to assume the market has a higher opinion of the business than it did five years ago. And that's hardly shocking given the track record of growth.

The company's earnings per share (over time) is depicted in the image below (click to see the exact numbers).

This free interactive report on Parkway Life Real Estate Investment Trust's earnings, revenue and cash flow is a great place to start, if you want to investigate the stock further.

What About Dividends?

It is important to consider the total shareholder return, as well as the share price return, for any given stock. 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. It's fair to say that the TSR gives a more complete picture for stocks that pay a dividend. As it happens, Parkway Life Real Estate Investment Trust's TSR for the last 5 years was 129%, which exceeds the share price return mentioned earlier. And there's no prize for guessing that the dividend payments largely explain the divergence!

A Different Perspective

It's good to see that Parkway Life Real Estate Investment Trust has rewarded shareholders with a total shareholder return of 16% in the last twelve months. That's including the dividend. However, that falls short of the 18% TSR per annum it has made for shareholders, each year, over five years. It's always interesting to track share price performance over the longer term. But to understand Parkway Life Real Estate Investment Trust better, we need to consider many other factors. Case in point: We've spotted 3 warning signs for Parkway Life Real Estate Investment Trust you should be aware of, and 2 of them don't sit too well with us.

We will like Parkway Life Real Estate Investment Trust 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 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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