Recent 4.6% pullback isn't enough to hurt long-term Golden Entertainment (NASDAQ:GDEN) shareholders, they're still up 326% over 3 years

Investing can be hard but the potential fo an individual stock to pay off big time inspires us. Not every pick can be a winner, but when you pick the right stock, you can win big. One such superstar is Golden Entertainment, Inc. (NASDAQ:GDEN), which saw its share price soar 326% in three years. And in the last month, the share price has gained 20%. But this could be related to good market conditions -- stocks in its market are up 8.0% in the last month.

While this past week has detracted from the company's three-year return, let's look at the recent trends of the underlying business and see if the gains have been in alignment.

Check out our latest analysis for Golden Entertainment

SWOT Analysis for Golden Entertainment

While markets are a powerful pricing mechanism, share prices reflect investor sentiment, not just underlying business performance. 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, Golden Entertainment moved from a loss to profitability. That kind of transition can be an inflection point that justifies a strong share price gain, just as we have seen here.

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 Golden Entertainment has improved its bottom line over the last three years, but what does the future have in store? This free interactive report on Golden Entertainment's balance sheet strength is a great place to start, if you want to investigate the stock further.

A Different Perspective

Golden Entertainment provided a TSR of 8.7% over the last twelve months. But that was short of the market average. The silver lining is that the gain was actually better than the average annual return of 8% per year over five year. 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 Golden Entertainment better, we need to consider many other factors. Case in point: We've spotted 2 warning signs for Golden Entertainment you should be aware of, and 1 of them can't be ignored.

If you like to buy stocks alongside management, then you might just love this free list of companies. (Hint: insiders have been buying them).

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.