ACRES Commercial Realty (NYSE:ACR) shareholder returns have been decent, earning 69% in 3 years

Thanks in no small measure to Vanguard founder Jack Bogle, it's easy buy a low cost index fund, which should provide the average market return. But if you pick the right individual stocks, you could make more than that. Notably, the ACRES Commercial Realty Corp. (NYSE:ACR) share price has gained 69% in three years, which is better than the average market return. In contrast, the stock is actually down 26% in the last year, suggesting a lack of positive momentum.

Since it's been a strong week for ACRES Commercial Realty shareholders, let's have a look at trend of the longer term fundamentals.

View our latest analysis for ACRES Commercial Realty

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.

During three years of share price growth, ACRES Commercial Realty achieved compound earnings per share growth of 80% per year. However, extraordinary items have impacted recent EPS numbers. The average annual share price increase of 19% is actually lower than the EPS growth. So it seems investors have become more cautious about the company, over time.

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

It is of course excellent to see how ACRES Commercial Realty has grown profits over the years, but the future is more important for shareholders. This free interactive report on ACRES Commercial Realty's balance sheet strength is a great place to start, if you want to investigate the stock further.

A Different Perspective

While the broader market lost about 10% in the twelve months, ACRES Commercial Realty shareholders did even worse, losing 26%. Having said that, it's inevitable that some stocks will be oversold in a falling market. The key is to keep your eyes on the fundamental developments. Unfortunately, last year's performance may indicate unresolved challenges, given that it was worse than the annualised loss of 10% over the last half decade. We realise that Baron Rothschild has said investors should "buy when there is blood on the streets", but we caution that investors should first be sure they are buying a high quality business. It's always interesting to track share price performance over the longer term. But to understand ACRES Commercial Realty better, we need to consider many other factors. Case in point: We've spotted 1 warning sign for ACRES Commercial Realty you should be aware of.

Of course ACRES Commercial Realty 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.