Nasdaq
華爾街日報MSM Malaysia Holdings Berhad (KLSE:MSM) shareholder returns have been respectable, earning 87% in 5 years
When we invest, we're generally looking for stocks that outperform the market average. And the truth is, you can make significant gains if you buy good quality businesses at the right price. For example, long term MSM Malaysia Holdings Berhad (KLSE:MSM) shareholders have enjoyed a 81% share price rise over the last half decade, well in excess of the market return of around 7.8% (not including dividends).
Since it's been a strong week for MSM Malaysia Holdings Berhad shareholders, let's have a look at trend of the longer term fundamentals.
To quote Buffett, 'Ships will sail around the world but the Flat Earth Society will flourish. There will continue to be wide discrepancies between price and value in the marketplace...' 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 the last half decade, MSM Malaysia Holdings Berhad became profitable. That's generally thought to be a genuine positive, so investors may expect to see an increasing share price.
You can see below how EPS has changed over time (discover the exact values by clicking on the image).
We know that MSM Malaysia Holdings Berhad has improved its bottom line over the last three years, but what does the future have in store? This free interactive report on MSM Malaysia Holdings Berhad's balance sheet strength is a great place to start, if you want to investigate the stock further.
What About The Total Shareholder Return (TSR)?
We've already covered MSM Malaysia Holdings Berhad's share price action, but we should also mention its total shareholder return (TSR). 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. MSM Malaysia Holdings Berhad's TSR of 87% for the 5 years exceeded its share price return, because it has paid dividends.
A Different Perspective
Investors in MSM Malaysia Holdings Berhad had a tough year, with a total loss of 30%, against a market gain of about 9.6%. However, keep in mind that even the best stocks will sometimes underperform the market over a twelve month period. On the bright side, long term shareholders have made money, with a gain of 13% per year over half a decade. It could be that the recent sell-off is an opportunity, so it may be worth checking the fundamental data for signs of a long term growth trend. It's always interesting to track share price performance over the longer term. But to understand MSM Malaysia Holdings Berhad better, we need to consider many other factors. Take risks, for example - MSM Malaysia Holdings Berhad has 2 warning signs (and 1 which is potentially serious) we think you should know about.
If you like to buy stocks alongside management, then you might just love this free list of companies. (Hint: many of them are unnoticed AND have attractive valuation).
Please note, the market returns quoted in this article reflect the market weighted average returns of stocks that currently trade on Malaysian 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.