Scan-D (GTSM:6195) Shareholders Booked A 25% Gain In The Last Year

One way to deal with stock volatility is to ensure you have a properly diverse portfolio. Of course, the aim of the game is to pick stocks that do better than an index fund. Scan-D Corporation (GTSM:6195) has done well over the last year, with the stock price up 25% beating the market return of 23% (not including dividends). Unfortunately the longer term returns are not so good, with the stock falling 21% in the last three years.

Check out our latest analysis for Scan-D

To paraphrase Benjamin Graham: Over the short term the market is a voting machine, but over the long term it's a weighing machine. 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 last year Scan-D grew its earnings per share (EPS) by 84%. It's fair to say that the share price gain of 25% did not keep pace with the EPS growth. So it seems like the market has cooled on Scan-D, despite the growth. Interesting.

The image below shows how EPS has tracked over time (if you click on the image you can see greater detail).

This free interactive report on Scan-D's earnings, revenue and cash flow is a great place to start, if you want to investigate the stock further.

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. It's fair to say that the TSR gives a more complete picture for stocks that pay a dividend. We note that for Scan-D the TSR over the last year was 32%, which is better than the share price return mentioned above. This is largely a result of its dividend payments!

A Different Perspective

We're pleased to report that Scan-D shareholders have received a total shareholder return of 32% over one year. Of course, that includes the dividend. Since the one-year TSR is better than the five-year TSR (the latter coming in at 6% per year), it would seem that the stock's performance has improved in recent times. In the best case scenario, this may hint at some real business momentum, implying that now could be a great time to delve deeper. 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. Case in point: We've spotted 5 warning signs for Scan-D you should be aware of, and 1 of them is a bit concerning.

Of course Scan-D may not be the best stock to buy. So you may wish to see this free collection of growth stocks.

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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