For many, the main point of investing is to generate higher returns than the overall market. But in any portfolio, there will be mixed results between individual stocks. At this point some shareholders may be questioning their investment in Wuxi Rural Commercial Bank Co.,Ltd (SHSE:600908), since the last five years saw the share price fall 37%.
Since Wuxi Rural Commercial BankLtd has shed CN¥577m from its value in the past 7 days, let's see if the longer term decline has been driven by the business' economics.
Check out our latest analysis for Wuxi Rural Commercial BankLtd
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 the unfortunate half decade during which the share price slipped, Wuxi Rural Commercial BankLtd actually saw its earnings per share (EPS) improve by 12% per year. Given the share price reaction, one might suspect that EPS is not a good guide to the business performance during the period (perhaps due to a one-off loss or gain). Or possibly, the market was previously very optimistic, so the stock has disappointed, despite improving EPS.
Because of the sharp contrast between the EPS growth rate and the share price growth, we're inclined to look to other metrics to understand the changing market sentiment around the stock.
Revenue is actually up 8.7% over the time period. A more detailed examination of the revenue and earnings may or may not explain why the share price languishes; there could be an opportunity.
The image below shows how earnings and revenue have tracked over time (if you click on the image you can see greater detail).
SHSE:600908 Earnings and Revenue Growth October 26th 2022
We know that Wuxi Rural Commercial BankLtd has improved its bottom line lately, but what does the future have in store? So we recommend checking out this free report showing consensus forecasts
What About Dividends?
When looking at investment returns, it is important to consider the difference between total shareholder return (TSR) and share price return. The TSR is a return calculation that accounts for the value of cash dividends (assuming that any dividend received was reinvested) and the calculated value of any discounted capital raisings and spin-offs. It's fair to say that the TSR gives a more complete picture for stocks that pay a dividend. As it happens, Wuxi Rural Commercial BankLtd's TSR for the last 5 years was -26%, which exceeds the share price return mentioned earlier. The dividends paid by the company have thusly boosted the total shareholder return.
A Different Perspective
Although it hurts that Wuxi Rural Commercial BankLtd returned a loss of 8.1% in the last twelve months, the broader market was actually worse, returning a loss of 17%. Unfortunately, last year's performance may indicate unresolved challenges, given that it's worse than the annualised loss of 5% over the last half decade. While some investors do well specializing in buying companies that are struggling (but nonetheless undervalued), don't forget that Buffett said that 'turnarounds seldom turn'. 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. Case in point: We've spotted 1 warning sign for Wuxi Rural Commercial BankLtd you should be aware of.
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.
對許多人來説,投資的主要目的是創造比整體市場更高的回報。但在任何投資組合中,個股之間的結果都會喜憂參半。在這一點上,一些股東可能會質疑他們在無錫農村商業銀行股份有限公司(上交所:600908),自過去五年以來,股價下跌了37%。
由於無錫農村商業銀行股份有限公司在過去7天裏市值縮水5.77億元人民幣,讓我們看看長期下跌是否受到了企業經濟的推動。
查看我們對無錫農村商業銀行有限公司的最新分析
本傑明·格雷厄姆(Benjamin Graham)的原話是:短期內,市場是一臺投票機,但從長遠來看,它是一臺稱重機。一種不完美但簡單的方法來考慮市場對一家公司的看法是如何改變的,那就是將每股收益(EPS)的變化與股價走勢進行比較。
不幸的是,在股價下滑的五年裏,無錫農村商業銀行的每股收益(EPS)以每年12%的速度增長。考慮到股價的反應,人們可能會懷疑,每股收益不是這段時間內業務表現的良好指南(可能是因為一次性的虧損或收益)。也有可能,此前市場非常樂觀,因此儘管每股收益有所改善,但該股仍令人失望。
由於每股收益增長率和股價增長率之間的鮮明對比,我們傾向於通過其他指標來了解圍繞股票不斷變化的市場情緒。
這一時期的營收實際增長了8.7%。對營收和收益進行更詳細的審查,可能會解釋股價低迷的原因,也可能解釋不了;可能會有機會。
下圖顯示了收益和收入隨時間的變化情況(如果您點擊該圖,您可以看到更多詳細信息)。
上海證交所:600908收益和收入增長2022年10月26日
我們知道無錫農村商業銀行最近提高了利潤,但未來會是什麼樣子呢?因此,我們建議您查看以下內容免費顯示共識預測的報告
那股息呢?
在考察投資回報時,重要的是要考慮到股東總回報(TSR)和股價回報。TSR是一種回報計算,計入了現金股息的價值(假設收到的任何股息都進行了再投資),以及任何貼現融資和剝離的計算價值。公平地説,TSR為支付股息的股票提供了更完整的圖景。恰好,無錫農村商業銀行過去5年的TSR為-26%,超過了前面提到的股價回報率。該公司支付的股息因此提振了總計股東回報。
不同的視角
儘管無錫農村商業銀行在過去12個月裏虧損8.1%令人痛心,但大盤實際上更糟糕,虧損17%。不幸的是,去年的表現可能預示着尚未解決的挑戰,因為它比過去五年5%的年化損失更糟糕。雖然一些投資者擅長買入那些陷入困境(但估值仍然被低估)的公司,但不要忘記巴菲特曾説過,扭虧為盈的情況很少出現轉機。雖然值得考慮市場狀況對股價可能產生的不同影響,但還有其他更重要的因素。一個恰當的例子:我們發現了無錫農村商業銀行有限公司1個警示標誌你應該意識到。
如果你像我一樣,你會的不想懷念這一切嗎?免費內部人士正在收購的成長型公司名單。
請注意,本文引用的市場回報反映了目前在CN交易所交易的股票的市場加權平均回報。
對這篇文章有什麼反饋嗎?擔心內容嗎? 保持聯繫直接與我們聯繫。或者,也可以給編輯組發電子郵件,地址是implywallst.com。
本文由Simply Wall St.撰寫,具有概括性。我們僅使用不偏不倚的方法提供基於歷史數據和分析師預測的評論,我們的文章並不打算作為財務建議。它不構成買賣任何股票的建議,也沒有考慮你的目標或你的財務狀況。我們的目標是為您帶來由基本面數據驅動的長期重點分析。請注意,我們的分析可能不會將最新的對價格敏感的公司公告或定性材料考慮在內。Simply Wall St.對上述任何一隻股票都沒有持倉。