If You Had Bought TAIWAN CHELIC's (TPE:4555) Shares Five Years Ago You Would Be Down 37%
Ideally, your overall portfolio should beat the market average. But the main game is to find enough winners to more than offset the losers At this point some shareholders may be questioning their investment in TAIWAN CHELIC Co., Ltd. (TPE:4555), since the last five years saw the share price fall 37%.
View our latest analysis for TAIWAN CHELIC
There is no denying that markets are sometimes efficient, but prices do not always reflect underlying business performance. One way to examine how market sentiment has changed over time is to look at the interaction between a company's share price and its earnings per share (EPS).
During the five years over which the share price declined, TAIWAN CHELIC's earnings per share (EPS) dropped by 24% each year. The share price decline of 9% per year isn't as bad as the EPS decline. The relatively muted share price reaction might be because the market expects the business to turn around.
You can see below how EPS has changed over time (discover the exact values by clicking on the image).
This free interactive report on TAIWAN CHELIC's earnings, revenue and cash flow is a great place to start, if you want to investigate the stock further.
What About Dividends?
When looking at investment returns, it is important to consider the difference between total shareholder return (TSR) and share price return. 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. As it happens, TAIWAN CHELIC's TSR for the last 5 years was -26%, which exceeds the share price return mentioned earlier. This is largely a result of its dividend payments!
A Different Perspective
TAIWAN CHELIC shareholders are up 1.4% for the year (even including dividends). But that return falls short of the market. But at least that's still a gain! Over five years the TSR has been a reduction of 5% per year, over five years. It could well be that the business is stabilizing. 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. Take risks, for example - TAIWAN CHELIC has 3 warning signs (and 2 which can't be ignored) we think you should know about.
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 TW exchanges.
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About TWSE:4555
TAIWAN CHELIC
Engages in the manufacture and sale of pneumatic and electric actuator automation components in Taiwan and internationally.
Excellent balance sheet with moderate growth potential.