Wiwynn (TPE:6669) Has Rewarded Shareholders With An Exceptional 501% Total Return On Their Investment

For us, stock picking is in large part the hunt for the truly magnificent stocks. Not every pick can be a winner, but when you pick the right stock, you can win big. One such superstar is Wiwynn Corporation (TPE:6669), which saw its share price soar 425% in three years. And in the last month, the share price has gained 0.1%.

Check out our latest analysis for Wiwynn

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 flawed but reasonable way to assess how sentiment around a company has changed is to compare the earnings per share (EPS) with the share price.

During three years of share price growth, Wiwynn achieved compound earnings per share growth of 82% per year. We note that the 74% yearly (average) share price gain isn't too far from the EPS growth rate. Coincidence? Probably not. That suggests that the market sentiment around the company hasn't changed much over that time. Rather, the share price has approximately tracked EPS growth.

You can see how EPS has changed over time in the image below (click on the chart to see the exact values).

We know that Wiwynn has improved its bottom line over the last three years, but what does the future have in store? Take a more thorough look at Wiwynn's financial health with this free report on its balance sheet.

What about the Total Shareholder Return (TSR)?

We've already covered Wiwynn's share price action, but we should also mention its 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 and spin-offs. Its history of dividend payouts mean that Wiwynn's TSR of 501% over the last 3 years is better than the share price return.

A Different Perspective

Over the last year Wiwynn shareholders have received a TSR of 20%. It's always nice to make money but this return falls short of the market return which was about 39% for the year. But the (superior) three-year TSR of 82% per year is some consolation. Even the best companies don't see strong share price performance every year. I find it very interesting to look at share price over the long term as a proxy for business performance. But to truly gain insight, we need to consider other information, too. For instance, we've identified 2 warning signs for Wiwynn that you should be aware of.

Of course Wiwynn 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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