Huron Consulting Group's (NASDAQ:HURN) three-year earnings growth trails the solid shareholder returns

The most you can lose on any stock (assuming you don't use leverage) is 100% of your money. But when you pick a company that is really flourishing, you can make more than 100%. For instance the Huron Consulting Group Inc. (NASDAQ:HURN) share price is 166% higher than it was three years ago. That sort of return is as solid as granite. It's also up 20% in about a month. This could be related to the recent financial results that were recently released - you could check the most recent data by reading our company report.

Since it's been a strong week for Huron Consulting Group shareholders, let's have a look at trend of the longer term fundamentals.

See our latest analysis for Huron Consulting Group

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 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 three years of share price growth, Huron Consulting Group achieved compound earnings per share growth of 64% per year. The average annual share price increase of 39% is actually lower than the EPS growth. So one could reasonably conclude that the market has cooled on the stock.

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

It is of course excellent to see how Huron Consulting Group has grown profits over the years, but the future is more important for shareholders. You can see how its balance sheet has strengthened (or weakened) over time in this free interactive graphic.

A Different Perspective

Huron Consulting Group provided a TSR of 18% over the last twelve months. But that return falls short of the market. On the bright side, that's still a gain, and it's actually better than the average return of 13% over half a decade This suggests the company might be improving over time. 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. Take risks, for example - Huron Consulting Group has 2 warning signs we think you should be aware of.

Of course Huron Consulting Group 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 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.