Announcing: Acushnet Holdings (NYSE:GOLF) Stock Increased An Energizing 118% In The Last Three Years
The most you can lose on any stock (assuming you don't use leverage) is 100% of your money. But in contrast you can make much more than 100% if the company does well. For instance the Acushnet Holdings Corp. (NYSE:GOLF) share price is 118% higher than it was three years ago. That sort of return is as solid as granite. It's also good to see the share price up 23% over the last quarter. But this move may well have been assisted by the reasonably buoyant market (up 14% in 90 days).
See our latest analysis for Acushnet Holdings
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. 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.
Acushnet Holdings was able to grow its EPS at 1.3% per year over three years, sending the share price higher. In comparison, the 30% per year gain in the share price outpaces the EPS growth. This suggests that, as the business progressed over the last few years, it gained the confidence of market participants. That's not necessarily surprising considering the three-year track record of earnings growth.
The company's earnings per share (over time) is depicted in the image below (click to see the exact numbers).
Before buying or selling a stock, we always recommend a close examination of historic growth trends, available here.
What About Dividends?
As well as measuring the share price return, investors should also consider the total shareholder return (TSR). 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. As it happens, Acushnet Holdings' TSR for the last 3 years was 132%, which exceeds the share price return mentioned earlier. The dividends paid by the company have thusly boosted the total shareholder return.
A Different Perspective
Pleasingly, Acushnet Holdings' total shareholder return last year was 52%. And yes, that does include the dividend. That gain actually surpasses the 32% TSR it generated (per year) over three years. Given the track record of solid returns over varying time frames, it might be worth putting Acushnet Holdings on your watchlist. It's always interesting to track share price performance over the longer term. But to understand Acushnet Holdings better, we need to consider many other factors. For example, we've discovered 1 warning sign for Acushnet Holdings that you should be aware of before investing here.
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 US exchanges.
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. 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.
Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.
