It is a pleasure to report that the APAC Realty Limited (SGX:CLN) is up 38% in the last quarter. But that doesn’t change the reality of under-performance over the last twelve months. In fact the stock is down 48% in the last year, well below the market return.
While markets are a powerful pricing mechanism, share prices reflect investor sentiment, not just underlying business performance. 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.
Unhappily, APAC Realty had to report a 15% decline in EPS over the last year. This reduction in EPS is not as bad as the 48% share price fall. This suggests the EPS fall has made some shareholders are more nervous about the business. The P/E ratio of 9.38 also points to the negative market sentiment.
The company’s earnings per share (over time) is depicted in the image below (click to see the exact numbers).
It is of course excellent to see how APAC Realty has grown profits over the years, but the future is more important for shareholders. Take a more thorough look at APAC Realty’s financial health with this free report on its balance sheet.
What About Dividends?
As well as measuring the share price return, investors should also consider the 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. So for companies that pay a generous dividend, the TSR is often a lot higher than the share price return. We note that for APAC Realty the TSR over the last year was -45%, which is better than the share price return mentioned above. And there’s no prize for guessing that the dividend payments largely explain the divergence!
A Different Perspective
APAC Realty shareholders are down 45% for the year (even including dividends), even worse than the market loss of 4.5%. That’s disappointing, but it’s worth keeping in mind that the market-wide selling wouldn’t have helped. It’s great to see a nice little 38% rebound in the last three months. This could just be a bounce because the selling was too aggressive, but fingers crossed it’s the start of a new trend. Before spending more time on APAC Realty it might be wise to click here to see if insiders have been buying or selling shares.
If you would prefer to check out another company — one with potentially superior financials — then do not miss this free list of companies that have proven they can grow earnings.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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If you spot an error that warrants correction, please contact the editor at firstname.lastname@example.org. 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. Simply Wall St has no position in the stocks mentioned. Thank you for reading.