U.S. Markets closed
  • S&P Futures

    3,603.50
    +27.50 (+0.77%)
     
  • Dow Futures

    29,813.00
    +267.00 (+0.90%)
     
  • Nasdaq Futures

    11,969.00
    +63.75 (+0.54%)
     
  • Russell 2000 Futures

    1,837.70
    +20.60 (+1.13%)
     
  • Crude Oil

    43.49
    +0.43 (+1.00%)
     
  • Gold

    1,821.50
    -16.30 (-0.89%)
     
  • Silver

    23.41
    -0.22 (-0.94%)
     
  • EUR/USD

    1.1854
    +0.0008 (+0.0711%)
     
  • 10-Yr Bond

    0.8570
    +0.0280 (+3.38%)
     
  • Vix

    22.66
    -1.04 (-4.39%)
     
  • GBP/USD

    1.3332
    +0.0010 (+0.0733%)
     
  • USD/JPY

    104.5530
    +0.0650 (+0.0622%)
     
  • BTC-USD

    18,362.97
    +30.46 (+0.17%)
     
  • CMC Crypto 200

    369.51
    +8.08 (+2.24%)
     
  • FTSE 100

    6,333.84
    -17.61 (-0.28%)
     
  • Nikkei 225

    26,229.12
    +701.75 (+2.75%)
     

Investors Who Bought CapitaLand Mall Trust (SGX:C38U) Shares A Year Ago Are Now Down 23%

Simply Wall St
·3 min read

CapitaLand Mall Trust (SGX:C38U) shareholders should be happy to see the share price up 12% in the last month. But that doesn't alter the fact that returns have lagged the market over the last year. Indeed, shareholders received returns of 20% whereas the market is down , returning (-20%) over the last year.

See our latest analysis for CapitaLand Mall Trust

There is no denying that markets are sometimes efficient, but prices do not always reflect underlying business performance. One imperfect but simple way to consider how the market perception of a company has shifted is to compare the change in the earnings per share (EPS) with the share price movement.

Unfortunately CapitaLand Mall Trust reported an EPS drop of 1.3% for the last year. The share price decline of 23% is actually more than the EPS drop. So it seems the market was too confident about the business, a year ago. The less favorable sentiment is reflected in its current P/E ratio of 9.95.

You can see how EPS has changed over time in the image below (click on the chart to see the exact values).

SGX:C38U Past and Future Earnings May 27th 2020
SGX:C38U Past and Future Earnings May 27th 2020

It's probably worth noting we've seen significant insider buying in the last quarter, which we consider a positive. On the other hand, we think the revenue and earnings trends are much more meaningful measures of the business. It might be well worthwhile taking a look at our free report on CapitaLand Mall Trust's earnings, revenue and cash flow.

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. It's fair to say that the TSR gives a more complete picture for stocks that pay a dividend. In the case of CapitaLand Mall Trust, it has a TSR of -20% for the last year. That exceeds its share price return that we previously mentioned. And there's no prize for guessing that the dividend payments largely explain the divergence!

A Different Perspective

The total return of 20% received by CapitaLand Mall Trust shareholders over the last year isn't far from the market return of -19%. The silver lining is that longer term investors would have made a total return of 2.2% per year over half a decade. If the fundamental data remains strong, and the share price is simply down on sentiment, then this could be an opportunity worth investigating. I find it very interesting to look at share price over the long term as a proxy for business performance. But to truly gain insight, we need to consider other information, too. To that end, you should learn about the 3 warning signs we've spotted with CapitaLand Mall Trust (including 1 which is is significant) .

CapitaLand Mall Trust is not the only stock that insiders are buying. For those who like to find winning investments this free list of growing companies with recent insider purchasing, could be just the ticket.

Please note, the market returns quoted in this article reflect the market weighted average returns of stocks that currently trade on SG exchanges.

Love or hate this article? Concerned about the content? Get in touch with us directly. Alternatively, email 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. 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. Thank you for reading.