MYR Group (NASDAQ:MYRG) sheds 5.0% this week, as yearly returns fall more in line with earnings growth
Long term investing can be life changing when you buy and hold the truly great businesses. And we've seen some truly amazing gains over the years. For example, the MYR Group Inc. (NASDAQ:MYRG) share price is up a whopping 334% in the last half decade, a handsome return for long term holders. And this is just one example of the epic gains achieved by some long term investors. On the other hand, the stock price has retraced 5.0% in the last week. But note that the broader market is down 0.3% since last week, and this may have impacted MYR Group's share price.
While this past week has detracted from the company's five-year return, let's look at the recent trends of the underlying business and see if the gains have been in alignment.
See our latest analysis for MYR Group
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.
During five years of share price growth, MYR Group achieved compound earnings per share (EPS) growth of 24% per year. This EPS growth is lower than the 34% average annual increase in the share price. This suggests that market participants hold the company in higher regard, these days. And that's hardly shocking given the track record of growth.
The graphic below depicts how EPS has changed over time (unveil the exact values by clicking on the image).
It might be well worthwhile taking a look at our free report on MYR Group's earnings, revenue and cash flow.
A Different Perspective
MYR Group provided a TSR of 25% over the last twelve months. But that return falls short of the market. On the bright side, the longer term returns (running at about 34% a year, over half a decade) look better. It may well be that this is a business worth popping on the watching, given the continuing positive reception, over time, from the market. Before spending more time on MYR Group it might be wise to click here to see if insiders have been buying or selling shares.
If you like to buy stocks alongside management, then you might just love this free list of companies. (Hint: insiders have been buying them).
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.
