Did Business Growth Power ATS Automation Tooling Systems' (TSE:ATA) Share Price Gain of 147%?
When you buy a stock there is always a possibility that it could drop 100%. But when you pick a company that is really flourishing, you can make more than 100%. For instance, the price of ATS Automation Tooling Systems Inc. (TSE:ATA) stock is up an impressive 147% over the last five years. Also pleasing for shareholders was the 18% gain in the last three months. But this could be related to the strong market, which is up 8.9% in the last three months.
See our latest analysis for ATS Automation Tooling Systems
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 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).
During five years of share price growth, ATS Automation Tooling Systems achieved compound earnings per share (EPS) growth of 0.5% per year. This EPS growth is slower than the share price growth of 20% per year, over the same period. This suggests that market participants hold the company in higher regard, these days. And that's hardly shocking given the track record of growth. This favorable sentiment is reflected in its (fairly optimistic) P/E ratio of 46.54.
You can see how EPS has changed over time in the image below (click on the chart to see the exact values).
Dive deeper into ATS Automation Tooling Systems' key metrics by checking this interactive graph of ATS Automation Tooling Systems's earnings, revenue and cash flow.
A Different Perspective
It's good to see that ATS Automation Tooling Systems has rewarded shareholders with a total shareholder return of 72% in the last twelve months. That's better than the annualised return of 20% over half a decade, implying that the company is doing better recently. Someone with an optimistic perspective could view the recent improvement in TSR as indicating that the business itself is getting better with time. Before forming an opinion on ATS Automation Tooling Systems you might want to consider these 3 valuation metrics.
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 CA 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.
