Low-cost index funds make it easy to achieve average market returns. But across the board there are plenty of stocks that underperform the market. For example, the Fortress Transportation and Infrastructure Investors LLC (NYSE:FTAI) share price return of 31% over three years lags the market return in the same period. On the other hand, the more recent gain of 28% over a year is certainly pleasing.
To paraphrase Benjamin Graham: Over the short term the market is a voting machine, but over the long term it's a weighing machine. 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.
Fortress Transportation and Infrastructure Investors 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).
We know that Fortress Transportation and Infrastructure Investors has improved its bottom line over the last three years, but what does the future have in store? You can see how its balance sheet has strengthened (or weakened) over time in this free interactive graphic.
What About Dividends?
It is important to consider the total shareholder return, as well as the share price return, for any given stock. Whereas the share price return only reflects the change in the share price, the TSR includes the value of dividends (assuming they were reinvested) and the benefit of any discounted capital raising or spin-off. It's fair to say that the TSR gives a more complete picture for stocks that pay a dividend. In the case of Fortress Transportation and Infrastructure Investors, it has a TSR of 67% for the last 3 years. That exceeds its share price return that we previously mentioned. The dividends paid by the company have thusly boosted the total shareholder return.
A Different Perspective
We're pleased to report that Fortress Transportation and Infrastructure Investors rewarded shareholders with a total shareholder return of 39% over the last year. That includes the value of the dividend. That's better than the annualized TSR of 19% over the last three years. Given the track record of solid returns over varying time frames, it might be worth putting Fortress Transportation and Infrastructure Investors on your watchlist. Before forming an opinion on Fortress Transportation and Infrastructure Investors you might want to consider the cold hard cash it pays as a dividend. This free chart tracks its dividend over time.
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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 email@example.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.
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