Did You Participate In Any Of Sweeten Real Estate DevelopmentLtd's (TPE:5525) Respectable 82% Return?

By buying an index fund, investors can approximate the average market return. But if you choose individual stocks with prowess, you can make superior returns. Just take a look at Sweeten Real Estate Development Co.,Ltd. (TPE:5525), which is up 56%, over three years, soundly beating the market return of 35% (not including dividends). However, more recent returns haven't been as impressive as that, with the stock returning just 5.4% in the last year , including dividends .

Check out our latest analysis for Sweeten Real Estate DevelopmentLtd

While the efficient markets hypothesis continues to be taught by some, it has been proven that markets are over-reactive dynamic systems, and investors are not always rational. 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).

Sweeten Real Estate DevelopmentLtd was able to grow its EPS at 53% per year over three years, sending the share price higher. The average annual share price increase of 16% is actually lower than the EPS growth. Therefore, it seems the market has moderated its expectations for growth, somewhat. Of course, with a P/E ratio of 51.15, the market remains optimistic.

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

Dive deeper into Sweeten Real Estate DevelopmentLtd's key metrics by checking this interactive graph of Sweeten Real Estate DevelopmentLtd's earnings, revenue and cash flow.

What About Dividends?

It is important to consider the total shareholder return, as well as the share price return, for any given stock. 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 and spin-offs. It's fair to say that the TSR gives a more complete picture for stocks that pay a dividend. As it happens, Sweeten Real Estate DevelopmentLtd's TSR for the last 3 years was 82%, 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

Sweeten Real Estate DevelopmentLtd shareholders gained a total return of 5.4% during the year. But that was short of the market average. It's probably a good sign that the company has an even better long term track record, having provided shareholders with an annual TSR of 16% over five years. It may well be that this is a business worth popping on the watching, given the continuing positive reception, over time, from the market. It's always interesting to track share price performance over the longer term. But to understand Sweeten Real Estate DevelopmentLtd better, we need to consider many other factors. To that end, you should learn about the 3 warning signs we've spotted with Sweeten Real Estate DevelopmentLtd (including 1 which shouldn't be ignored) .

But note: Sweeten Real Estate DevelopmentLtd may not be the best stock to buy. So take a peek at this free list of interesting companies with past earnings growth (and further growth forecast).

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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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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