If you want to compound wealth in the stock market, you can do so by buying an index fund. But you can do a lot better than that by buying good quality businesses for attractive prices. For example, the Adobe Inc. (NASDAQ:ADBE) share price is up 86% in the last five years, slightly above the market return. Also positive is the 17% share price rise over the last year.
The past week has proven to be lucrative for Adobe investors, so let's see if fundamentals drove the company's five-year performance.
To paraphrase Benjamin Graham: Over the short term the market is a voting machine, but over the long term it's a weighing machine. 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.
Over half a decade, Adobe managed to grow its earnings per share at 16% a year. The EPS growth is more impressive than the yearly share price gain of 13% over the same period. So it seems the market isn't so enthusiastic about the stock these days.
The company's earnings per share (over time) is depicted in the image below (click to see the exact numbers).
NasdaqGS:ADBE Earnings Per Share Growth July 4th 2024
Before buying or selling a stock, we always recommend a close examination of historic growth trends, available here.
A Different Perspective
Adobe provided a TSR of 17% over the last twelve months. But that was short of the market average. The silver lining is that the gain was actually better than the average annual return of 13% per year over five year. It is possible that returns will improve along with the business 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. For example, we've discovered 1 warning sign for Adobe that you should be aware of before investing here.
But note: Adobe may not be the best stock to buy. So take a peek at this free list of interesting companies with past earnings growth (and further growth forecast).
Please note, the market returns quoted in this article reflect the market weighted average returns of stocks that currently trade on American exchanges.
如果你想在股票市場上增加財富,你可以通過購買指數基金來實現。但是,通過以誘人的價格收購優質的企業,你可以做得比這好得多。例如,Adobe公司(納斯達克股票代碼:ADBE)的股價在過去五年中上漲了86%,略高於市場回報率。去年股價上漲了17%,這也是一個積極因素。
事實證明,過去一週對Adobe投資者來說是有利可圖的,所以讓我們看看基本面是否推動了公司的五年業績。
用本傑明·格雷厄姆的話來說:從短期來看,市場是一臺投票機器,但從長遠來看,它是一臺稱重機。考慮市場對公司的看法發生了怎樣的變化的一種不完美但簡單的方法是將每股收益(EPS)的變化與股價走勢進行比較。
在過去的五年中,Adobe設法將其每股收益增長到每年16%。每股收益的增長比同期13%的年度股價增長更令人印象深刻。因此,如今市場似乎對該股並不那麼熱情。
該公司的每股收益(隨着時間的推移)如下圖所示(點擊查看確切數字)。
納斯達克GS:2024年7月4日ADBE每股收益增長
在買入或賣出股票之前,我們始終建議仔細研究歷史增長趨勢,可在此處查閱。
不同的視角
在過去的十二個月中,Adobe提供的股東回報率爲17%。但這低於市場平均水平。一線希望是,收益實際上好於五年內每年13%的平均年回報率。回報率可能會隨着業務基本面的改善而改善。儘管市場狀況可能對股價產生的不同影響值得考慮,但還有其他因素更爲重要。例如,我們發現了Adobe的1個警告信號,在投資之前,您應該注意這一點。
但請注意:Adobe可能不是最值得購買的股票。因此,來看看這份過去盈利增長(以及進一步增長預測)的有趣公司的免費清單。
請注意,本文引用的市場回報反映了目前在美國交易所交易的股票的市場加權平均回報。