Investors in Middleby (NASDAQ:MIDD) have seen favorable returns of 51% over the past five years

The main point of investing for the long term is to make money. But more than that, you probably want to see it rise more than the market average. But The Middleby Corporation (NASDAQ:MIDD) has fallen short of that second goal, with a share price rise of 51% over five years, which is below the market return. However, more recent buyers should be happy with the increase of 21% over the last year.

So let's investigate and see if the longer term performance of the company has been in line with the underlying business' progress.

View our latest analysis for Middleby

To quote Buffett, 'Ships will sail around the world but the Flat Earth Society will flourish. There will continue to be wide discrepancies between price and value in the marketplace...' 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.

Over half a decade, Middleby managed to grow its earnings per share at 3.7% a year. This EPS growth is lower than the 9% average annual increase in the share price. So it's fair to assume the market has a higher opinion of the business than it did five years ago. That's not necessarily surprising considering the five-year track record of earnings growth.

The company's earnings per share (over time) is depicted in the image below (click to see the exact numbers).

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

A Different Perspective

Middleby shareholders are up 21% for the year. But that was short of the market average. On the bright side, that's still a gain, and it's actually better than the average return of 9% over half a decade It is possible that returns will improve along with the business fundamentals. It's always interesting to track share price performance over the longer term. But to understand Middleby better, we need to consider many other factors. Case in point: We've spotted 1 warning sign for Middleby you should be aware of.

If you like to buy stocks alongside management, then you might just love this free list of companies. (Hint: many of them are unnoticed AND have attractive valuation).

Please note, the market returns quoted in this article reflect the market weighted average returns of stocks that currently trade on American exchanges.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. 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.