The three-year returns for StealthGas' (NASDAQ:GASS) shareholders have been splendid, yet its earnings growth was even better

It hasn't been the best quarter for StealthGas Inc. (NASDAQ:GASS) shareholders, since the share price has fallen 19% in that time. But in three years the returns have been great. The share price marched upwards over that time, and is now 148% higher than it was. To some, the recent share price pullback wouldn't be surprising after such a good run. The fundamental business performance will ultimately dictate whether the top is in, or if this is a stellar buying opportunity.

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

View our latest analysis for StealthGas

In his essay The Superinvestors of Graham-and-Doddsville Warren Buffett described how share prices do not always rationally reflect the value of a business. One way to examine how market sentiment has changed over time is to look at the interaction between a company's share price and its earnings per share (EPS).

StealthGas was able to grow its EPS at 185% per year over three years, sending the share price higher. The average annual share price increase of 35% is actually lower than the EPS growth. So one could reasonably conclude that the market has cooled on the stock. This cautious sentiment is reflected in its (fairly low) P/E ratio of 3.18.

The graphic below depicts how EPS has changed over time (unveil the exact values by clicking on the image).

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

A Different Perspective

Investors in StealthGas had a tough year, with a total loss of 13%, against a market gain of about 24%. However, keep in mind that even the best stocks will sometimes underperform the market over a twelve month period. Longer term investors wouldn't be so upset, since they would have made 11%, each year, over five years. If the fundamental data continues to indicate long term sustainable growth, the current sell-off could be an opportunity worth considering. It's always interesting to track share price performance over the longer term. But to understand StealthGas better, we need to consider many other factors. To that end, you should learn about the 2 warning signs we've spotted with StealthGas (including 1 which is a bit unpleasant) .

Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of companies we expect will grow earnings.

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.