Those who invested in Casella Waste Systems (NASDAQ:CWST) five years ago are up 402%

Casella Waste Systems, Inc. (NASDAQ:CWST) shareholders have seen the share price descend 17% over the month. But over five years returns have been remarkably great. In fact, during that period, the share price climbed 402%. Impressive! Arguably, the recent fall is to be expected after such a strong rise. Only time will tell if there is still too much optimism currently reflected in the share price.

Now it's worth having a look at the company's fundamentals too, because that will help us determine if the long term shareholder return has matched the performance of the underlying business.

View our latest analysis for Casella Waste Systems

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).

Over half a decade, Casella Waste Systems managed to grow its earnings per share at 128% a year. The EPS growth is more impressive than the yearly share price gain of 38% over the same period. So one could conclude that the broader market has become more cautious towards the stock. Of course, with a P/E ratio of 88.02, 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).

earnings-per-share-growth

We know that Casella Waste Systems has improved its bottom line over the last three years, but what does the future have in store? It might be well worthwhile taking a look at our free report on how its financial position has changed over time.

A Different Perspective

We're pleased to report that Casella Waste Systems shareholders have received a total shareholder return of 2.0% over one year. Having said that, the five-year TSR of 38% a year, is even better. The pessimistic view would be that be that the stock has its best days behind it, but on the other hand the price might simply be moderating while the business itself continues to execute. It's always interesting to track share price performance over the longer term. But to understand Casella Waste Systems better, we need to consider many other factors. Consider risks, for instance. Every company has them, and we've spotted 4 warning signs for Casella Waste Systems you should know about.

But note: Casella Waste Systems may not be the best stock to buy. So take a peek at this free list of interesting companies with past earnings growth (and further growth forecast).

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