Investors in Central Garden & Pet (NASDAQ:CENT) have made a return of 26% over the past three years
Central Garden & Pet Company (NASDAQ:CENT) shareholders might be concerned after seeing the share price drop 15% in the last quarter. In contrast the stock is up over the last three years. In that time, it is up 26%, which isn't bad, but not amazing either.
Let's take a look at the underlying fundamentals over the longer term, and see if they've been consistent with shareholders returns.
Check out our latest analysis for Central Garden & Pet
There is no denying that markets are sometimes efficient, but prices do not always reflect 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.
Central Garden & Pet was able to grow its EPS at 16% per year over three years, sending the share price higher. The average annual share price increase of 8% is actually lower than the EPS growth. So one could reasonably conclude that the market has cooled on the stock.
You can see below how EPS has changed over time (discover the exact values by clicking on the image).
Dive deeper into Central Garden & Pet's key metrics by checking this interactive graph of Central Garden & Pet's earnings, revenue and cash flow.
A Different Perspective
While the broader market lost about 21% in the twelve months, Central Garden & Pet shareholders did even worse, losing 26%. However, it could simply be that the share price has been impacted by broader market jitters. It might be worth keeping an eye on the fundamentals, in case there's a good opportunity. Unfortunately, last year's performance may indicate unresolved challenges, given that it was worse than the annualised loss of 2% over the last half decade. Generally speaking long term share price weakness can be a bad sign, though contrarian investors might want to research the stock in hope of a turnaround. It's always interesting to track share price performance over the longer term. But to understand Central Garden & Pet better, we need to consider many other factors. To that end, you should be aware of the 1 warning sign we've spotted with Central Garden & Pet .
We will like Central Garden & Pet better if we see some big insider buys. While we wait, check out this free list of growing companies with considerable, recent, insider buying.
Please note, the market returns quoted in this article reflect the market weighted average returns of stocks that currently trade on US exchanges.
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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. 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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