Ever Sunshine Lifestyle Services Group (HKG:1995) Shareholders Have Enjoyed An Impressive 198% Share Price Gain

When you buy shares in a company, there is always a risk that the price drops to zero. But when you pick a company that is really flourishing, you can make more than 100%. For example, the Ever Sunshine Lifestyle Services Group Limited (HKG:1995) share price has soared 198% in the last year. Most would be very happy with that, especially in just one year! On top of that, the share price is up 78% in about a quarter. Ever Sunshine Lifestyle Services Group hasn't been listed for long, so it's still not clear if it is a long term winner.

Check out our latest analysis for Ever Sunshine Lifestyle Services Group

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.

Ever Sunshine Lifestyle Services Group was able to grow EPS by 92% in the last twelve months. This EPS growth is significantly lower than the 198% increase in the share price. So it's fair to assume the market has a higher opinion of the business than it a year ago. This favorable sentiment is reflected in its (fairly optimistic) P/E ratio of 67.39.

You can see how EPS has changed over time in the image below (click on the chart to see the exact values).

We consider it positive that insiders have made significant purchases in the last year. Having said that, most people consider earnings and revenue growth trends to be a more meaningful guide to the business. This free interactive report on Ever Sunshine Lifestyle Services Group's earnings, revenue and cash flow is a great place to start, if you want to investigate the stock further.

What About Dividends?

As well as measuring the share price return, investors should also consider the total shareholder return (TSR). The TSR incorporates the value of any spin-offs or discounted capital raisings, along with any dividends, based on the assumption that the dividends are reinvested. Arguably, the TSR gives a more comprehensive picture of the return generated by a stock. As it happens, Ever Sunshine Lifestyle Services Group's TSR for the last year was 201%, which exceeds the share price return mentioned earlier. This is largely a result of its dividend payments!

A Different Perspective

It's nice to see that Ever Sunshine Lifestyle Services Group shareholders have gained 201% over the last year , including dividends . A substantial portion of that gain has come in the last three months, with the stock up 78% in that time. Demand for the stock from multiple parties is pushing the price higher; it could be that word is getting out about its virtues as a business. I find it very interesting to look at share price over the long term as a proxy for business performance. But to truly gain insight, we need to consider other information, too. Consider for instance, the ever-present spectre of investment risk. We've identified 1 warning sign with Ever Sunshine Lifestyle Services Group , and understanding them should be part of your investment process.

If you like to buy stocks alongside management, then you might just love this free list of companies. (Hint: insiders have been buying them).

Please note, the market returns quoted in this article reflect the market weighted average returns of stocks that currently trade on HK exchanges.

If you spot an error that warrants correction, please contact the editor at editorial-team@simplywallst.com. 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. Simply Wall St has no position in the stocks mentioned.

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