These days it's easy to simply buy an index fund, and your returns should (roughly) match the market. But if you pick the right individual stocks, you could make more than that. To wit, the iRay Technology Company Limited (SHSE:688301) share price is 47% higher than it was a year ago, much better than the market decline of around 15% (not including dividends) in the same period. If it can keep that out-performance up over the long term, investors will do very well! iRay Technology hasn't been listed for long, so it's still not clear if it is a long term winner.

With that in mind, it's worth seeing if the company's underlying fundamentals have been the driver of long term performance, or if there are some discrepancies.

Check out our latest analysis for iRay Technology

In his essay The Superinvestors of Graham-and-Doddsville Warren Buffett described how share prices do not always rationally reflect the value of a business. 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.

During the last year iRay Technology grew its earnings per share (EPS) by 68%. It's fair to say that the share price gain of 47% did not keep pace with the EPS growth. Therefore, it seems the market isn't as excited about iRay Technology as it was before. This could be an opportunity. Of course, with a P/E ratio of 54.71, the market remains optimistic.

The image below shows how EPS has tracked over time (if you click on the image you can see greater detail).

It is of course excellent to see how iRay Technology has grown profits over the years, but the future is more important for shareholders. If you are thinking of buying or selling iRay Technology stock, you should check out this FREE detailed report on its balance sheet.

A Different Perspective

iRay Technology shareholders should be happy with the total gain of 48% over the last twelve months, including dividends. We regret to report that the share price is down 1.7% over ninety days. It may simply be that the share price got ahead of itself, although there may have been fundamental developments that are weighing on it. It's always interesting to track share price performance over the longer term. But to understand iRay Technology better, we need to consider many other factors. To that end, you should learn about the 2 warning signs we've spotted with iRay Technology (including 1 which can't be ignored) .

If you are like me, then you will not want to miss this free list of growing companies that insiders are buying.

Please note, the market returns quoted in this article reflect the market weighted average returns of stocks that currently trade on CN 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.