If You Had Bought Rémy Cointreau (EPA:RCO) Shares Five Years Ago You'd Have Made 97%
Rémy Cointreau SA (EPA:RCO) shareholders might be concerned after seeing the share price drop 14% in the last quarter. On the bright side the returns have been quite good over the last half decade. Its return of 97% has certainly bested the market return!
See our latest analysis for Rémy Cointreau
There is no denying that markets are sometimes efficient, but prices do not always reflect underlying business performance. One flawed but reasonable way to assess how sentiment around a company has changed is to compare the earnings per share (EPS) with the share price.
During five years of share price growth, Rémy Cointreau achieved compound earnings per share (EPS) growth of 22% per year. The EPS growth is more impressive than the yearly share price gain of 15% over the same period. Therefore, it seems the market has become relatively pessimistic about the company.
The image below shows how EPS has tracked over time (if you click on the image you can see greater detail).
Before buying or selling a stock, we always recommend a close examination of historic growth trends, available here.
What About Dividends?
It is important to consider the total shareholder return, as well as the share price return, for any given stock. The TSR incorporates the value of any spin-offs or discounted capital raisings, along with any dividends, based on the assumption that the dividends are reinvested. So for companies that pay a generous dividend, the TSR is often a lot higher than the share price return. As it happens, Rémy Cointreau's TSR for the last 5 years was 117%, which exceeds the share price return mentioned earlier. This is largely a result of its dividend payments!
A Different Perspective
Rémy Cointreau provided a TSR of 9.2% over the last twelve months. But that return falls short of the market. If we look back over five years, the returns are even better, coming in at 17% per year for five years. Maybe the share price is just taking a breather while the business executes on its growth strategy. Before deciding if you like the current share price, check how Rémy Cointreau scores on these 3 valuation metrics.
Of course Rémy Cointreau 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 FR 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.
