Despite the downward trend in earnings at Supernus Pharmaceuticals (NASDAQ:SUPN) the stock advances 3.1%, bringing five-year gains to 56%

When you buy and hold a stock for the long term, you definitely want it to provide a positive return. Better yet, you'd like to see the share price move up more than the market average. But Supernus Pharmaceuticals, Inc. (NASDAQ:SUPN) has fallen short of that second goal, with a share price rise of 56% over five years, which is below the market return. Some buyers are laughing, though, with an increase of 35% in the last year.

On the back of a solid 7-day performance, let's check what role the company's fundamentals have played in driving long term shareholder returns.

Check out our latest analysis for Supernus Pharmaceuticals

To paraphrase Benjamin Graham: Over the short term the market is a voting machine, but over the long term it's a weighing machine. By comparing earnings per share (EPS) and share price changes over time, we can get a feel for how investor attitudes to a company have morphed over time.

Supernus Pharmaceuticals' earnings per share are down 12% per year, despite strong share price performance over five years.

Essentially, it doesn't seem likely that investors are focused on EPS. Since the change in EPS doesn't seem to correlate with the change in share price, it's worth taking a look at other metrics.

On the other hand, Supernus Pharmaceuticals' revenue is growing nicely, at a compound rate of 9.0% over the last five years. In that case, the company may be sacrificing current earnings per share to drive growth.

You can see below how earnings and revenue have changed over time (discover the exact values by clicking on the image).

We know that Supernus Pharmaceuticals has improved its bottom line lately, but what does the future have in store? You can see what analysts are predicting for Supernus Pharmaceuticals in this interactive graph of future profit estimates.

A Different Perspective

It's nice to see that Supernus Pharmaceuticals shareholders have received a total shareholder return of 35% over the last year. Since the one-year TSR is better than the five-year TSR (the latter coming in at 9% per year), it would seem that the stock's performance has improved in recent times. Someone with an optimistic perspective could view the recent improvement in TSR as indicating that the business itself is getting better with time. It's always interesting to track share price performance over the longer term. But to understand Supernus Pharmaceuticals better, we need to consider many other factors. For example, we've discovered 1 warning sign for Supernus Pharmaceuticals that you should be aware of before investing here.

Of course Supernus Pharmaceuticals 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.