Did You Participate In Any Of Kronos Worldwide's (NYSE:KRO) Incredible 364% Return?

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, if you buy shares in a high quality company at the right price, you can gain well over 100%. For example, the Kronos Worldwide, Inc. (NYSE:KRO) share price has soared 256% in the last half decade. Most would be very happy with that. It's down 2.5% in the last seven days.

See our latest analysis for Kronos Worldwide

While markets are a powerful pricing mechanism, share prices reflect investor sentiment, not just underlying business performance. 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 the last half decade, Kronos Worldwide became profitable. That kind of transition can be an inflection point that justifies a strong share price gain, just as we have seen here.

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

Dive deeper into Kronos Worldwide's key metrics by checking this interactive graph of Kronos Worldwide's earnings, revenue and cash flow.

What About Dividends?

As well as measuring the share price return, investors should also consider the total shareholder return (TSR). The TSR incorporates the value of any spin-offs or discounted capital raisings, along with any dividends, based on the assumption that the dividends are reinvested. So for companies that pay a generous dividend, the TSR is often a lot higher than the share price return. As it happens, Kronos Worldwide's TSR for the last 5 years was 364%, which exceeds the share price return mentioned earlier. And there's no prize for guessing that the dividend payments largely explain the divergence!

A Different Perspective

It's nice to see that Kronos Worldwide shareholders have received a total shareholder return of 27% over the last year. That's including the dividend. Having said that, the five-year TSR of 36% a year, is even better. It's always interesting to track share price performance over the longer term. But to understand Kronos Worldwide better, we need to consider many other factors. Even so, be aware that Kronos Worldwide is showing 3 warning signs in our investment analysis , and 1 of those is a bit concerning...

We will like Kronos Worldwide better if we see some big insider buys. While we wait, check out this free list of growing companies with considerable, recent, insider buying.

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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