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El Pollo Loco Holdings (NASDAQ:LOCO) Shareholders Booked A 65% Gain In The Last Three Years

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  • LOCO

By buying an index fund, you can roughly match the market return with ease. But if you choose individual stocks with prowess, you can make superior returns. For example, the El Pollo Loco Holdings, Inc. (NASDAQ:LOCO) share price is up 65% in the last three years, clearly besting the market return of around 40% (not including dividends). However, more recent returns haven't been as impressive as that, with the stock returning just 9.4% in the last year.

View our latest analysis for El Pollo Loco Holdings

There is no denying that markets are sometimes efficient, but prices do not always reflect 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.

El Pollo Loco Holdings became profitable within the last three years. So we would expect a higher share price over the period.

The image below shows how EPS has tracked over time (if you click on the image you can see greater detail).

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

We know that El Pollo Loco Holdings has improved its bottom line over the last three years, but what does the future have in store? This free interactive report on El Pollo Loco Holdings' balance sheet strength is a great place to start, if you want to investigate the stock further.

A Different Perspective

El Pollo Loco Holdings provided a TSR of 9.4% over the last twelve months. But that return falls short of the market. On the bright side, that's still a gain, and it's actually better than the average return of 7% over half a decade This suggests the company might be improving over time. It's always interesting to track share price performance over the longer term. But to understand El Pollo Loco Holdings better, we need to consider many other factors. Consider risks, for instance. Every company has them, and we've spotted 2 warning signs for El Pollo Loco Holdings you should know about.

Of course El Pollo Loco Holdings may not be the best stock to buy. So you may wish to see this free collection of growth stocks.

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.

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