One simple way to benefit from the stock market is to buy an index fund. But many of us dare to dream of bigger returns, and build a portfolio ourselves. For example, the Luzhou Bank Co., Ltd. (HKG:1983) share price is up 10% in the last three years, clearly besting the market decline of around 14% (not including dividends). However, more recent returns haven't been as impressive as that, with the stock returning just 7.2% in the last year.

The past week has proven to be lucrative for Luzhou Bank investors, so let's see if fundamentals drove the company's three-year performance.

View our latest analysis for Luzhou Bank

There is no denying that markets are sometimes efficient, but prices do not always reflect underlying business performance. One way to examine how market sentiment has changed over time is to look at the interaction between a company's share price and its earnings per share (EPS).

What about the Total Shareholder Return (TSR)?

Investors should note that there's a difference between Luzhou Bank's total shareholder return (TSR) and its share price change, which we've covered above. The TSR attempts to capture the value of dividends (as if they were reinvested) as well as any spin-offs or discounted capital raisings offered to shareholders. Its history of dividend payouts mean that Luzhou Bank's TSR of 23% over the last 3 years is better than the share price return.

A Different Perspective

We're pleased to report that Luzhou Bank rewarded shareholders with a total shareholder return of 7.2% over the last year. That's better than the annualized TSR of 7% over the last three years. Given the track record of solid returns over varying time frames, it might be worth putting Luzhou Bank on your watchlist. While it is well worth considering the different impacts that market conditions can have on the share price, there are other factors that are even more important. Even so, be aware that Luzhou Bank is showing 1 warning sign in our investment analysis , 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 HK 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.