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Dycom Industries' (NYSE:DY) three-year total shareholder returns outpace the underlying earnings growth

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It hasn't been the best quarter for Dycom Industries, Inc. (NYSE:DY) shareholders, since the share price has fallen 14% in that time. But over three years, the returns would have left most investors smiling After all, the share price is up a market-beating 52% in that time.

Although Dycom Industries has shed US$262m from its market cap this week, let's take a look at its longer term fundamental trends and see if they've driven returns.

See our latest analysis for Dycom Industries

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).

During three years of share price growth, Dycom Industries achieved compound earnings per share growth of 5.9% per year. This EPS growth is lower than the 15% average annual increase in the share price. 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).

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

Dive deeper into Dycom Industries' key metrics by checking this interactive graph of Dycom Industries's earnings, revenue and cash flow.

A Different Perspective

We're pleased to report that Dycom Industries shareholders have received a total shareholder return of 21% over one year. That certainly beats the loss of about 1.3% per year over the last half decade. We generally put more weight on the long term performance over the short term, but the recent improvement could hint at a (positive) inflection point within the business. It's always interesting to track share price performance over the longer term. But to understand Dycom Industries better, we need to consider many other factors. To that end, you should be aware of the 1 warning sign we've spotted with Dycom Industries .

We will like Dycom Industries 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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.

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.