Investors in First Mid Bancshares (NASDAQ:FMBH) have unfortunately lost 9.4% over the last year
Most people feel a little frustrated if a stock they own goes down in price. But often it is not a reflection of the fundamental business performance. The First Mid Bancshares, Inc. (NASDAQ:FMBH) is down 11% over a year, but the total shareholder return is -9.4% once you include the dividend. And that total return actually beats the market decline of 18%. The silver lining (for longer term investors) is that the stock is still 5.7% higher than it was three years ago.
With that in mind, it's worth seeing if the company's underlying fundamentals have been the driver of long term performance, or if there are some discrepancies.
See our latest analysis for First Mid Bancshares
In his essay The Superinvestors of Graham-and-Doddsville Warren Buffett described how share prices do not always rationally reflect the value of a business. 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).
Even though the First Mid Bancshares share price is down over the year, its EPS actually improved. Of course, the situation might betray previous over-optimism about growth.
It's fair to say that the share price does not seem to be reflecting the EPS growth. But we might find some different metrics explain the share price movements better.
First Mid Bancshares' revenue is actually up 40% over the last year. Since we can't easily explain the share price movement based on these metrics, it might be worth considering how market sentiment has changed towards the stock.
You can see below how earnings and revenue have 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. It's always worth keeping an eye on CEO pay, but a more important question is whether the company will grow earnings throughout the years. This free report showing analyst forecasts should help you form a view on First Mid Bancshares
A Different Perspective
While it's never nice to take a loss, First Mid Bancshares shareholders can take comfort that , including dividends,their trailing twelve month loss of 9.4% wasn't as bad as the market loss of around 18%. Longer term investors wouldn't be so upset, since they would have made 3%, each year, over five years. It could be that the business is just facing some short term problems, but shareholders should keep a close eye on the fundamentals. While it is well worth considering the different impacts that market conditions can have on the share price, there are other factors that are even more important. Even so, be aware that First Mid Bancshares is showing 2 warning signs in our investment analysis , you should know about...
We will like First Mid Bancshares 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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