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Introducing Legacy Housing (NASDAQ:LEGH), A Stock That Climbed 17% In The Last Year

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Simply Wall St
·2 min read
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On average, over time, stock markets tend to rise higher. This makes investing attractive. But if when you choose to buy stocks, some of them will be below average performers. Unfortunately for shareholders, while the Legacy Housing Corporation (NASDAQ:LEGH) share price is up 17% in the last year, that falls short of the market return. We'll need to follow Legacy Housing for a while to get a better sense of its share price trend, since it hasn't been listed for particularly long.

See our latest analysis for Legacy Housing

To paraphrase Benjamin Graham: Over the short term the market is a voting machine, but over the long term it's a weighing machine. One way to examine how market sentiment has changed over time is to look at the interaction between a company's share price and its earnings per share (EPS).

Legacy Housing was able to grow EPS by 34% in the last twelve months. It's fair to say that the share price gain of 17% did not keep pace with the EPS growth. So it seems like the market has cooled on Legacy Housing, despite the growth. Interesting. This cautious sentiment is reflected in its (fairly low) P/E ratio of 11.99.

You can see below how EPS has changed over time (discover the exact values by clicking on the image).

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

It's probably worth noting that the CEO is paid less than the median at similar sized companies. But while CEO remuneration is always worth checking, the really important question is whether the company can grow earnings going forward. Before buying or selling a stock, we always recommend a close examination of historic growth trends, available here..

A Different Perspective

We're happy to report that Legacy Housing are up 17% over the year. The bad news is that's no better than the average market return, which was roughly 37%. Before deciding if you like the current share price, check how Legacy Housing scores on these 3 valuation metrics.

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.

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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.