Introducing Timbercreek Financial (TSE:TF), A Stock That Climbed 14% In The Last Three Years
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One simple way to benefit from the stock market is to buy an index fund. But if you pick the right individual stocks, you could make more than that. For example, the Timbercreek Financial Corporation (TSE:TF) share price is up 14% in the last three years, clearly besting than the market return of around 11% (not including dividends). On the other hand, the returns haven't been quite so good recently, with shareholders up just 11%, including dividends.
Check out our latest analysis for Timbercreek Financial
While markets are a powerful pricing mechanism, share prices reflect investor sentiment, not just 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.
Over the last three years, Timbercreek Financial failed to grow earnings per share, which fell 0.6% (annualized). The comparison of the modestly falling earnings per share, and the relatively resilient share price, suggests the market is less cautious about the stock, these days. Ultimately, though, we don't think it can maintain share price gains without turning around the EPS growth.
You can see below how EPS has changed over time (discover the exact values by clicking on the image).
We're pleased to report that the CEO is remunerated more modestly than most CEOs at similarly capitalized companies. But while CEO remuneration is always worth checking, the really important question is whether the company can grow earnings going forward. This free interactive report on Timbercreek Financial's earnings, revenue and cash flow is a great place to start, if you want to investigate the stock further.
What About Dividends?
As well as measuring the share price return, investors should also consider the total shareholder return (TSR). The TSR is a return calculation that accounts for the value of cash dividends (assuming that any dividend received was reinvested) and the calculated value of any discounted capital raisings and spin-offs. It's fair to say that the TSR gives a more complete picture for stocks that pay a dividend. As it happens, Timbercreek Financial's TSR for the last 3 years was 42%, which exceeds the share price return mentioned earlier. The dividends paid by the company have thusly boosted the total shareholder return.
A Different Perspective
We're pleased to report that Timbercreek Financial rewarded shareholders with a total shareholder return of 11% over the last year. That's including the dividend. That falls short of the 13% it has made, for shareholders, each year, over three years. Keeping this in mind, a solid next step might be to take a look at Timbercreek Financial's dividend track record. This free interactive graph is a great place to start.
But note: Timbercreek Financial may not be the best stock to buy. So take a peek at this free list of interesting companies with past earnings growth (and further growth forecast).
Please note, the market returns quoted in this article reflect the market weighted average returns of stocks that currently trade on CA exchanges.
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.
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. Thank you for reading.
