If You Had Bought WPP AUNZ (ASX:WPP) Stock A Year Ago, You Could Pocket A 24% Gain Today
Passive investing in index funds can generate returns that roughly match the overall market. But if you pick the right individual stocks, you could make more than that. For example, the WPP AUNZ Limited (ASX:WPP) share price is up 24% in the last year, clearly besting the market decline of around 2.7% (not including dividends). So that should have shareholders smiling. Zooming out, the stock is actually down 23% in the last three years.
Check out our latest analysis for WPP AUNZ
To quote Buffett, 'Ships will sail around the world but the Flat Earth Society will flourish. There will continue to be wide discrepancies between price and value in the marketplace...' 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 the last year WPP AUNZ grew its earnings per share (EPS) by 37%. Though we do note extraordinary items affected the bottom line. This EPS growth is significantly higher than the 24% increase in the share price. Therefore, it seems the market isn't as excited about WPP AUNZ as it was before. This could be an opportunity.
You can see below how EPS has changed over time (discover the exact values by clicking on the image).
We like that insiders have been buying shares in the last twelve months. Even so, future earnings will be far more important to whether current shareholders make money. It might be well worthwhile taking a look at our free report on WPP AUNZ's earnings, revenue and cash flow.
A Different Perspective
We're pleased to report that WPP AUNZ shareholders have received a total shareholder return of 24% over one year. Since the one-year TSR is better than the five-year TSR (the latter coming in at 4% per year), it would seem that the stock's performance has improved in recent times. Given the share price momentum remains strong, it might be worth taking a closer look at the stock, lest you miss an opportunity. It's always interesting to track share price performance over the longer term. But to understand WPP AUNZ better, we need to consider many other factors. For example, we've discovered 2 warning signs for WPP AUNZ (1 is potentially serious!) that you should be aware of before investing here.
WPP AUNZ is not the only stock insiders are buying. So take a peek at this free list of growing companies with insider buying.
Please note, the market returns quoted in this article reflect the market weighted average returns of stocks that currently trade on AU 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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