Central Garden & Pet (NASDAQ:CENT) Shareholders Have Enjoyed An Impressive 232% Share Price Gain

The worst result, after buying shares in a company (assuming no leverage), would be if you lose all the money you put in. But on the bright side, you can make far more than 100% on a really good stock. Long term Central Garden & Pet Company (NASDAQ:CENT) shareholders would be well aware of this, since the stock is up 232% in five years. It's also up 8.6% in about a month. But this could be related to good market conditions -- stocks in its market are up 5.0% in the last month.

View our latest analysis for Central Garden & Pet

There is no denying that markets are sometimes efficient, but prices do not always reflect 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 five years of share price growth, Central Garden & Pet achieved compound earnings per share (EPS) growth of 28% per year. This EPS growth is remarkably close to the 27% average annual increase in the share price. This indicates that investor sentiment towards the company has not changed a great deal. Rather, the share price has approximately tracked EPS growth.

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

We know that Central Garden & Pet has improved its bottom line lately, but is it going to grow revenue? You could check out this free report showing analyst revenue forecasts.

A Different Perspective

It's good to see that Central Garden & Pet has rewarded shareholders with a total shareholder return of 30% in the last twelve months. That gain is better than the annual TSR over five years, which is 27%. Therefore it seems like sentiment around the company has been positive lately. Given the share price momentum remains strong, it might be worth taking a closer look at the stock, lest you miss an opportunity. It's always interesting to track share price performance over the longer term. But to understand Central Garden & Pet better, we need to consider many other factors. Like risks, for instance. Every company has them, and we've spotted 2 warning signs for Central Garden & Pet (of which 1 is a bit concerning!) you should know about.

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 US exchanges.

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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.
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