MACOM Technology Solutions Holdings (NASDAQ:MTSI) lifts 4.3% this week, taking five-year gains to 449%
For many, the main point of investing in the stock market is to achieve spectacular returns. And we've seen some truly amazing gains over the years. To wit, the MACOM Technology Solutions Holdings, Inc. (NASDAQ:MTSI) share price has soared 449% over five years. If that doesn't get you thinking about long term investing, we don't know what will. It's also up 9.7% in about a month.
Since the stock has added US$284m to its market cap in the past week alone, let's see if underlying performance has been driving long-term returns.
Check out our latest analysis for MACOM Technology Solutions Holdings
While the efficient markets hypothesis continues to be taught by some, it has been proven that markets are over-reactive dynamic systems, and investors are not always rational. 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.
During the five years of share price growth, MACOM Technology Solutions Holdings moved from a loss to profitability. That kind of transition can be an inflection point that justifies a strong share price gain, just as we have seen here.
The image below shows how EPS has tracked over time (if you click on the image you can see greater detail).
We know that MACOM Technology Solutions Holdings has improved its bottom line over the last three years, but what does the future have in store? If you are thinking of buying or selling MACOM Technology Solutions Holdings stock, you should check out this FREE detailed report on its balance sheet.
A Different Perspective
We're pleased to report that MACOM Technology Solutions Holdings shareholders have received a total shareholder return of 40% over one year. However, the TSR over five years, coming in at 41% per year, is even more impressive. 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. Consider risks, for instance. Every company has them, and we've spotted 1 warning sign for MACOM Technology Solutions Holdings you should know about.
If you are like me, then you will not want to miss this free list of growing companies that insiders are buying.
Please note, the market returns quoted in this article reflect the market weighted average returns of stocks that currently trade on American 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.
