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Should Schneider National (NYSE:SNDR) Be Disappointed With Their 40% Profit?

On average, over time, stock markets tend to rise higher. This makes investing attractive. But if when you choose to buy stocks, some of them will be below average performers. For example, the Schneider National, Inc. (NYSE:SNDR), share price is up over the last year, but its gain of 40% trails the market return. Unfortunately the longer term returns are not so good, with the stock falling 7.8% in the last three years.

View our latest analysis for Schneider National

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 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.

During the last year Schneider National grew its earnings per share (EPS) by 44%. We note that the earnings per share growth isn't far from the share price growth (of 40%). This makes us think the market hasn't really changed its sentiment around the company, in the last year. We don't think its coincidental that the share price is growing at a similar rate to the earnings per share.

The graphic below depicts how EPS has changed over time (unveil the exact values by clicking on the image).

earnings-per-share-growth
earnings-per-share-growth

We know that Schneider National has improved its bottom line lately, but is it going to grow revenue? Check if analysts think Schneider National will grow revenue in the future.

What About Dividends?

When looking at investment returns, it is important to consider the difference between total shareholder return (TSR) and share price return. The TSR is a return calculation that accounts for the value of cash dividends (assuming that any dividend received was reinvested) and the calculated value of any discounted capital raisings and spin-offs. It's fair to say that the TSR gives a more complete picture for stocks that pay a dividend. In the case of Schneider National, it has a TSR of 54% for the last year. That exceeds its share price return that we previously mentioned. The dividends paid by the company have thusly boosted the total shareholder return.

A Different Perspective

Schneider National shareholders have gained 54% over twelve months (even including dividends). This isn't far from the market return of 60%. That's not at all bad, but the cherry on top is that it's an improvement on prior returns (since shareholders only made 1.4% yearly over the last three years). It's good to see the uptick, although the business fundamentals will need to move in the right direction if the company is to sustain the rise. Most investors take the time to check the data on insider transactions. You can click here to see if insiders have been buying or selling.

We will like Schneider National 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.

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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.

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