We think all investors should try to buy and hold high quality multi-year winners. While not every stock performs well, when investors win, they can win big. To wit, the Sanwei Holding Group Co.,Ltd (SHSE:603033) share price has soared 361% over five years. If that doesn't get you thinking about long term investing, we don't know what will. It's also up 15% in about a month.
The past week has proven to be lucrative for Sanwei Holding GroupLtd investors, so let's see if fundamentals drove the company's five-year performance.
See our latest analysis for Sanwei Holding GroupLtd
There is no denying that markets are sometimes efficient, but prices do not always reflect underlying business performance. By comparing earnings per share (EPS) and share price changes over time, we can get a feel for how investor attitudes to a company have morphed over time.
Over half a decade, Sanwei Holding GroupLtd managed to grow its earnings per share at 13% a year. This EPS growth is slower than the share price growth of 36% per year, over the same period. This suggests that market participants hold the company in higher regard, these days. And that's hardly shocking given the track record of growth. This optimism is visible in its fairly high P/E ratio of 71.43.
You can see how EPS has changed over time in the image below (click on the chart to see the exact values).
We know that Sanwei Holding GroupLtd has improved its bottom line lately, but is it going to grow revenue? Check if analysts think Sanwei Holding GroupLtd will grow revenue in the future.
What About The Total Shareholder Return (TSR)?
Investors should note that there's a difference between Sanwei Holding GroupLtd's total shareholder return (TSR) and its share price change, which we've covered above. Arguably the TSR is a more complete return calculation because it accounts for the value of dividends (as if they were reinvested), along with the hypothetical value of any discounted capital that have been offered to shareholders. Its history of dividend payouts mean that Sanwei Holding GroupLtd's TSR of 371% over the last 5 years is better than the share price return.
A Different Perspective
It's nice to see that Sanwei Holding GroupLtd shareholders have received a total shareholder return of 45% over the last year. That's better than the annualised return of 36% over half a decade, implying that the company is doing better recently. In the best case scenario, this may hint at some real business momentum, implying that now could be a great time to delve deeper. It's always interesting to track share price performance over the longer term. But to understand Sanwei Holding GroupLtd better, we need to consider many other factors. Consider risks, for instance. Every company has them, and we've spotted 2 warning signs for Sanwei Holding GroupLtd you should know about.
Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of companies we expect will grow earnings.
Please note, the market returns quoted in this article reflect the market weighted average returns of stocks that currently trade on Chinese 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.