U.S. Markets closed
  • S&P 500

    4,221.86
    -1.84 (-0.04%)
     
  • Dow 30

    33,823.45
    -210.22 (-0.62%)
     
  • Nasdaq

    14,161.35
    +121.67 (+0.87%)
     
  • Russell 2000

    2,287.46
    -27.23 (-1.18%)
     
  • Crude Oil

    71.06
    +0.02 (+0.03%)
     
  • Gold

    1,774.30
    -0.50 (-0.03%)
     
  • Silver

    25.95
    +0.09 (+0.36%)
     
  • EUR/USD

    1.1915
    -0.0086 (-0.7149%)
     
  • 10-Yr Bond

    1.5110
    -0.0580 (-3.70%)
     
  • Vix

    17.75
    -0.40 (-2.20%)
     
  • GBP/USD

    1.3930
    -0.0057 (-0.4054%)
     
  • USD/JPY

    110.2270
    -0.3860 (-0.3490%)
     
  • BTC-USD

    37,727.84
    -1,117.99 (-2.88%)
     
  • CMC Crypto 200

    938.66
    -31.22 (-3.22%)
     
  • FTSE 100

    7,153.43
    -31.52 (-0.44%)
     
  • Nikkei 225

    29,018.33
    -272.68 (-0.93%)
     

Did You Participate In Any Of Citrix Systems' (NASDAQ:CTXS) Respectable 87% Return?

  • Oops!
    Something went wrong.
    Please try again later.
·3 min read
  • Oops!
    Something went wrong.
    Please try again later.

Citrix Systems, Inc. (NASDAQ:CTXS) shareholders might be concerned after seeing the share price drop 16% in the last month. But at least the stock is up over the last five years. In that time, it is up 44%, which isn't bad, but is below the market return of 126%.

View our latest analysis for Citrix Systems

To quote Buffett, 'Ships will sail around the world but the Flat Earth Society will flourish. There will continue to be wide discrepancies between price and value in the marketplace...' 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, Citrix Systems achieved compound earnings per share (EPS) growth of 7.7% per year. That makes the EPS growth particularly close to the yearly share price growth of 8%. That suggests that the market sentiment around the company hasn't changed much over that time. In fact, the share price seems to largely reflect the EPS growth.

You can see below how EPS has changed over time (discover the exact values by clicking on the image).

earnings-per-share-growth
earnings-per-share-growth

It is of course excellent to see how Citrix Systems has grown profits over the years, but the future is more important for shareholders. This free interactive report on Citrix Systems' balance sheet strength is a great place to start, if you want to investigate the stock further.

What About Dividends?

It is important to consider the total shareholder return, as well as the share price return, for any given stock. 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. We note that for Citrix Systems the TSR over the last 5 years was 87%, which is better than the share price return mentioned above. This is largely a result of its dividend payments!

A Different Perspective

Investors in Citrix Systems had a tough year, with a total loss of 18% (including dividends), against a market gain of about 55%. Even the share prices of good stocks drop sometimes, but we want to see improvements in the fundamental metrics of a business, before getting too interested. Longer term investors wouldn't be so upset, since they would have made 13%, each year, over five years. If the fundamental data continues to indicate long term sustainable growth, the current sell-off could be an opportunity worth considering. 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. Consider for instance, the ever-present spectre of investment risk. We've identified 3 warning signs with Citrix Systems , and understanding them should be part of your investment process.

We will like Citrix Systems better if we see some big insider buys. While we wait, check out this free list of growing companies with considerable, recent, insider buying.

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.