If You Had Bought Hanger (NYSE:HNGR) Shares Five Years Ago You'd Have Earned 67% Returns

If you buy and hold a stock for many years, you'd hope to be making a profit. Better yet, you'd like to see the share price move up more than the market average. But Hanger, Inc. (NYSE:HNGR) has fallen short of that second goal, with a share price rise of 67% over five years, which is below the market return. The last year has been disappointing, with the stock price down 13% in that time.

View our latest analysis for Hanger

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.

During the five years of share price growth, Hanger moved from a loss to profitability. That's generally thought to be a genuine positive, so we would expect to see an increasing share price.

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 Hanger has improved its bottom line over the last three years, but what does the future have in store? Take a more thorough look at Hanger's financial health with this free report on its balance sheet.

A Different Perspective

While the broader market gained around 30% in the last year, Hanger shareholders lost 13%. However, keep in mind that even the best stocks will sometimes underperform the market over a twelve month period. On the bright side, long term shareholders have made money, with a gain of 11% per year over half a decade. 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 Hanger better, we need to consider many other factors. Like risks, for instance. Every company has them, and we've spotted 2 warning signs for Hanger (of which 1 is concerning!) you should know about.

Of course Hanger 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 US exchanges.

When trading Hanger or any other investment, use the platform considered by many to be the Professional's Gateway to the Worlds Market, Interactive Brokers. You get the lowest-cost* trading on stocks, options, futures, forex, bonds and funds worldwide from a single integrated account. Promoted

This article by Simply Wall St is general in nature. 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.
^*Interactive Brokers Rated Lowest Cost Broker by StockBrokers.com Annual Online Review 2020

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.