Yahoo Finance Should Alimentation Couche-Tard (TSE:ATD.B) Be Disappointed With Their 57% Profit?
It hasn't been the best quarter for Alimentation Couche-Tard Inc. (TSE:ATD.B) shareholders, since the share price has fallen 15% in that time. Looking further back, the stock has generated good profits over five years. After all, the share price is up a market-beating 57% in that time.
Check out our latest analysis for Alimentation Couche-Tard
There is no denying that markets are sometimes efficient, but prices do not always reflect underlying business performance. One flawed but reasonable way to assess how sentiment around a company has changed is to compare the earnings per share (EPS) with the share price.
During five years of share price growth, Alimentation Couche-Tard achieved compound earnings per share (EPS) growth of 17% per year. This EPS growth is higher than the 9.4% average annual increase in the share price. So one could conclude that the broader market has become more cautious towards the stock.
You can see how EPS has changed over time in the image below (click on the chart to see the exact values).
We like that insiders have been buying shares in the last twelve months. Having said that, most people consider earnings and revenue growth trends to be a more meaningful guide to the business. It might be well worthwhile taking a look at our free report on Alimentation Couche-Tard's earnings, revenue and cash flow.
What About Dividends?
When looking at investment returns, it is important to consider the difference between total shareholder return (TSR) and share price return. Whereas the share price return only reflects the change in the share price, the TSR includes the value of dividends (assuming they were reinvested) and the benefit of any discounted capital raising or spin-off. It's fair to say that the TSR gives a more complete picture for stocks that pay a dividend. In the case of Alimentation Couche-Tard, it has a TSR of 61% for the last 5 years. That exceeds its share price return that we previously mentioned. And there's no prize for guessing that the dividend payments largely explain the divergence!
A Different Perspective
While it's never nice to take a loss, Alimentation Couche-Tard shareholders can take comfort that , including dividends, their trailing twelve month loss of 3.9% wasn't as bad as the market loss of around 17%. Longer term investors wouldn't be so upset, since they would have made 10.0%, each year, over five years. In the best case scenario the last year is just a temporary blip on the journey to a brighter future. It's always interesting to track share price performance over the longer term. But to understand Alimentation Couche-Tard better, we need to consider many other factors. For example, we've discovered 2 warning signs for Alimentation Couche-Tard that you should be aware of before investing here.
Alimentation Couche-Tard is not the only stock that insiders are buying. For those who like to find winning investments this free list of growing companies with recent insider purchasing, could be just the ticket.
Please note, the market returns quoted in this article reflect the market weighted average returns of stocks that currently trade on CA exchanges.
If you spot an error that warrants correction, please contact the editor at editorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned.
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Thank you for reading.
