Does Zilltek Technology's (GTSM:6679) Share Price Gain of 89% Match Its Business Performance?

These days it's easy to simply buy an index fund, and your returns should (roughly) match the market. But if you pick the right individual stocks, you could make more than that. For example, the Zilltek Technology Corp. (GTSM:6679) share price is up 89% in the last year, clearly besting the market return of around 54% (not including dividends). That's a solid performance by our standards! We'll need to follow Zilltek Technology for a while to get a better sense of its share price trend, since it hasn't been listed for particularly long.

View our latest analysis for Zilltek Technology

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.

Zilltek Technology was able to grow EPS by 86% in the last twelve months. This EPS growth is remarkably close to the 89% increase in the share price. That suggests that the market sentiment around the company hasn't changed much over that time. We don't think its coincidental that the share price is growing at a similar rate to the earnings per share.

You can see below how EPS has changed over time (discover the exact values by clicking on the image).

It is of course excellent to see how Zilltek Technology has grown profits over the years, but the future is more important for shareholders. If you are thinking of buying or selling Zilltek Technology stock, you should check out this FREE detailed report on its balance sheet.

What About Dividends?

When looking at investment returns, it is important to consider the difference between total shareholder return (TSR) and share price return. 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. So for companies that pay a generous dividend, the TSR is often a lot higher than the share price return. We note that for Zilltek Technology the TSR over the last year was 91%, 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

Zilltek Technology shareholders should be happy with the total gain of 91% over the last twelve months, including dividends. And the share price momentum remains respectable, with a gain of 30% in the last three months. This suggests the company is continuing to win over new investors. Is Zilltek Technology cheap compared to other companies? These 3 valuation measures might help you decide.

We will like Zilltek Technology 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 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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