While not a mind-blowing move, it is good to see that the Norwegian Cruise Line Holdings Ltd. (NYSE:NCLH) share price has gained 26% in the last three months. But don't envy holders -- looking back over 5 years the returns have been really bad. Indeed, the share price is down 55% in the period. So we're hesitant to put much weight behind the short term increase. But it could be that the fall was overdone.

The recent uptick of 4.0% could be a positive sign of things to come, so let's take a look at historical fundamentals.

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 way to examine how market sentiment has changed over time is to look at the interaction between a company's share price and its earnings per share (EPS).

Norwegian Cruise Line Holdings became profitable within the last five years. Most would consider that to be a good thing, so it's counter-intuitive to see the share price declining. Other metrics might give us a better handle on how its value is changing over time.

Revenue is actually up 23% over the time period. A more detailed examination of the revenue and earnings may or may not explain why the share price languishes; there could be an opportunity.

The graphic below depicts how earnings and revenue have changed over time (unveil the exact values by clicking on the image).

It's good to see that there was some significant insider buying in the last three months. That's a positive. On the other hand, we think the revenue and earnings trends are much more meaningful measures of the business. You can see what analysts are predicting for Norwegian Cruise Line Holdings in this interactive graph of future profit estimates.

A Different Perspective

It's nice to see that Norwegian Cruise Line Holdings shareholders have received a total shareholder return of 29% over the last year. There's no doubt those recent returns are much better than the TSR loss of 9% per year over five years. We generally put more weight on the long term performance over the short term, but the recent improvement could hint at a (positive) inflection point within the business. It's always interesting to track share price performance over the longer term. But to understand Norwegian Cruise Line Holdings better, we need to consider many other factors. Even so, be aware that Norwegian Cruise Line Holdings is showing 3 warning signs in our investment analysis , and 1 of those is a bit unpleasant...

Norwegian Cruise Line Holdings is not the only stock insiders are buying. So take a peek at this free list of small cap companies at attractive valuations which insiders have been 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.