The total return for Teledyne Technologies (NYSE:TDY) investors has risen faster than earnings growth over the last five years

The main point of investing for the long term is to make money. Better yet, you'd like to see the share price move up more than the market average. But Teledyne Technologies Incorporated (NYSE:TDY) has fallen short of that second goal, with a share price rise of 27% over five years, which is below the market return. Over the last twelve months the stock price has risen a very respectable 13%.

In light of the stock dropping 4.3% in the past week, we want to investigate the longer term story, and see if fundamentals have been the driver of the company's positive five-year return.

View our latest analysis for Teledyne Technologies

To paraphrase Benjamin Graham: Over the short term the market is a voting machine, but over the long term it's a weighing machine. 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 five years of share price growth, Teledyne Technologies achieved compound earnings per share (EPS) growth of 9.7% per year. The EPS growth is more impressive than the yearly share price gain of 5% over the same period. So one could conclude that the broader market has become more cautious towards the stock.

You can see below how EPS has changed over time (discover the exact values by clicking on the image).

We're pleased to report that the CEO is remunerated more modestly than most CEOs at similarly capitalized companies. It's always worth keeping an eye on CEO pay, but a more important question is whether the company will grow earnings throughout the years. Dive deeper into the earnings by checking this interactive graph of Teledyne Technologies' earnings, revenue and cash flow.

A Different Perspective

Teledyne Technologies provided a TSR of 13% over the last twelve months. But that was short of the market average. The silver lining is that the gain was actually better than the average annual return of 5% per year over five year. This suggests the company might be improving over time. It's always interesting to track share price performance over the longer term. But to understand Teledyne Technologies better, we need to consider many other factors. Take risks, for example - Teledyne Technologies has 1 warning sign we think you should be aware of.

Of course Teledyne Technologies 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.