Does Esquire Financial Holdings's (NASDAQ:ESQ) Share Price Gain of 14% Match Its Business Performance?
We believe investing is smart because history shows that stock markets go higher in the long term. But not every stock you buy will perform as well as the overall market. Over the last year the Esquire Financial Holdings, Inc. (NASDAQ:ESQ) share price is up 14%, but that's less than the broader market return. Esquire Financial Holdings hasn't been listed for long, so it's still not clear if it is a long term winner.
View our latest analysis for Esquire Financial Holdings
While markets are a powerful pricing mechanism, share prices reflect investor sentiment, not just underlying business performance. One imperfect but simple way to consider how the market perception of a company has shifted is to compare the change in the earnings per share (EPS) with the share price movement.
During the last year Esquire Financial Holdings grew its earnings per share (EPS) by 101%. This EPS growth is significantly higher than the 14% increase in the share price. Therefore, it seems the market isn't as excited about Esquire Financial Holdings as it was before. This could be an opportunity.
The image below shows how EPS has tracked over time (if you click on the image you can see greater detail).
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. Dive deeper into the earnings by checking this interactive graph of Esquire Financial Holdings's earnings, revenue and cash flow.
A Different Perspective
We're happy to report that Esquire Financial Holdings are up 14% over the year. While it's always nice to make a profit on the stock market, we do note that the TSR was no better than the broader market return of about 27%. The last three months haven't been great for shareholder returns, since the share price has trailed the market by 7.3% in the last three months. It might be that investors are more concerned about the business lately due to some fundamental change (or else the share price simply got ahead of itself, previously). If you want to research this stock further, the data on insider buying is an obvious place to start. You can click here to see who has been buying shares - and the price they paid.
Esquire Financial Holdings 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 US 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.
