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Harbour-Link Group Berhad (KLSE:HARBOUR) sheds 12% this week as annual returns more in line with earnings growth

Harbour-Link Berhad Group (KLSE:HARBOUR) Shareholders may be worried after seeing the stock price drop 12% last week. But that should not overshadow the satisfactory returns obtained by shareholders over the past three years. In fact, the company’s stock price outperformed its stock index during this period, posting a 73% gain.

Although Harbour-Link Group Berhad lost RM56 million of its market capitalization this week, let’s take a look at its longer-term fundamental trends and see if they have generated any returns.

Before looking at performance, know that our analysis indicates that HARBOR is potentially undervalued!

Although the efficient markets hypothesis continues to be taught by some, it has been proven that markets are overly reactive dynamic systems and that investors are not always rational. An imperfect but reasonable way to gauge changing sentiment around a company is to compare earnings per share (EPS) with the stock price.

In three years of share price growth, Harbour-Link Group Berhad has achieved compound earnings per share growth of 81% per annum. This EPS growth is greater than the average annual share price increase of 20%. So it seems investors have become more cautious about the company over time. This cautious sentiment is reflected in its (rather low) P/E ratio of 2.88.

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

KLSE: HARBOR Earnings per share growth September 29, 2022

This free Harbour-Link Group Berhad’s Interactive Earnings, Revenue and Cash Flow Report is a great place to start if you want to dive deeper into the stock analysis.

What about dividends?

In addition to measuring share price performance, investors should also consider total shareholder return (TSR). While the share price return only reflects the change in the share price, the TSR includes the value of dividends (assuming they have been reinvested) and the benefit of any capital raising or spin-offs. off updated. It can be said that the TSR gives a more complete picture of the return generated by a stock. It turns out that Harbour-Link Group Berhad’s TSR for the last 3 years was 81%, which exceeds the share price return mentioned earlier. And there’s no price guessing that dividend payouts largely explain the divergence!

A different perspective

While the broader market lost around 8.1% in the twelve months, Harbor-Link Group Berhad shareholders fared even worse, losing 17% (even including dividends). However, it could simply be that the stock price was impacted by greater market jitters. It might be worth keeping an eye on the fundamentals, in case there is a good opportunity. Longer-term investors wouldn’t be so upset, as they would have gained 11%, every year, over five years. If fundamentals continue to point to sustainable long-term growth, the current sell-off could be an opportunity to consider. It is always interesting to follow the evolution of the share price over the long term. But to better understand Harbour-Link Group Berhad, we need to consider many other factors. For example, we have identified 2 warning signs for Harbour-Link Group Berhad of which you should be aware.

We’ll like Harbor-Link Group Berhad better if we see big insider buying. In the meantime, watch this free list of growing companies with significant and recent insider buying.

Please note that the market returns quoted in this article reflect the market-weighted average returns of the stocks currently trading on the MY Exchanges.

This Simply Wall St article is general in nature. We provide commentary based on historical data and analyst forecasts only using unbiased methodology and our articles are not intended to be financial advice. It is not a recommendation to buy or sell stocks and does not take into account your objectives or financial situation. Our goal is to bring you targeted long-term analysis based on fundamental data. Note that our analysis may not take into account the latest announcements from price-sensitive companies or qualitative materials. Simply Wall St has no position in the stocks mentioned.

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Find out if Harbour-Link Berhad Group is potentially overvalued or undervalued by viewing our full analysis, which includes fair value estimates, risks and warnings, dividends, insider trading and financial health.

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