If You Had Bought Pilgrim's Pride (NASDAQ:PPC) Stock Five Years Ago, You'd Be Sitting On A 20% Loss, Today
The main aim of stock picking is to find the market-beating stocks. But in any portfolio, there will be mixed results between individual stocks. At this point some shareholders may be questioning their investment in Pilgrim's Pride Corporation (NASDAQ:PPC), since the last five years saw the share price fall 20%. The share price has dropped 28% in three months. We note that the company has reported results fairly recently; and the market is hardly delighted. You can check out the latest numbers in our company report.
Check out our latest analysis for Pilgrim's Pride
There is no denying that markets are sometimes efficient, but prices do not always reflect underlying business performance. By comparing earnings per share (EPS) and share price changes over time, we can get a feel for how investor attitudes to a company have morphed over time.
Looking back five years, both Pilgrim's Pride's share price and EPS declined; the latter at a rate of 7.8% per year. This fall in the EPS is worse than the 4.3% compound annual share price fall. So investors might expect EPS to bounce back -- or they may have previously foreseen the EPS decline.
The company's earnings per share (over time) is depicted in the image below (click to see the exact numbers).
We know that Pilgrim's Pride has improved its bottom line lately, but is it going to grow revenue? If you're interested, you could check this free report showing consensus revenue forecasts.
What about the Total Shareholder Return (TSR)?
We'd be remiss not to mention the difference between Pilgrim's Pride's total shareholder return (TSR) and its share price return. Arguably the TSR is a more complete return calculation because it accounts for the value of dividends (as if they were reinvested), along with the hypothetical value of any discounted capital that have been offered to shareholders. Its history of dividend payouts mean that Pilgrim's Pride's TSR, which was a 10% drop over the last 5 years, was not as bad as the share price return.
A Different Perspective
Pilgrim's Pride provided a TSR of 16% over the year. That's fairly close to the broader market return. The silver lining is that the share price is up in the short term, which flies in the face of the annualised loss of 2.2% over the last five years. While 'turnarounds seldom turn' there are green shoots for Pilgrim's Pride. It's always interesting to track share price performance over the longer term. But to understand Pilgrim's Pride better, we need to consider many other factors. Be aware that Pilgrim's Pride is showing 2 warning signs in our investment analysis , you should know about...
Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of companies we expect will grow earnings.
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.
