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Those who invested in Tingyi (Cayman Islands) Holding (HKG:322) a year ago are up 34%

Simply Wall St · 05/15 23:08

If you want to compound wealth in the stock market, you can do so by buying an index fund. But investors can boost returns by picking market-beating companies to own shares in. To wit, the Tingyi (Cayman Islands) Holding Corp. (HKG:322) share price is 25% higher than it was a year ago, much better than the market return of around 15% (not including dividends) in the same period. So that should have shareholders smiling. However, the stock hasn't done so well in the longer term, with the stock only up 1.2% in three years.

So let's investigate and see if the longer term performance of the company has been in line with the underlying business' progress.

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In his essay The Superinvestors of Graham-and-Doddsville Warren Buffett described how share prices do not always rationally reflect the value of a business. 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).

During the last year Tingyi (Cayman Islands) Holding grew its earnings per share (EPS) by 20%. The share price gain of 25% certainly outpaced the EPS growth. This indicates that the market is now more optimistic about the stock.

The graphic below depicts how EPS has changed over time (unveil the exact values by clicking on the image).

earnings-per-share-growth
SEHK:322 Earnings Per Share Growth May 15th 2025

We know that Tingyi (Cayman Islands) Holding has improved its bottom line lately, but is it going to grow revenue? Check if analysts think Tingyi (Cayman Islands) Holding will grow revenue in the future.

What About Dividends?

When looking at investment returns, it is important to consider the difference between total shareholder return (TSR) and share price return. Whereas the share price return only reflects the change in the share price, the TSR includes the value of dividends (assuming they were reinvested) and the benefit of any discounted capital raising or spin-off. Arguably, the TSR gives a more comprehensive picture of the return generated by a stock. We note that for Tingyi (Cayman Islands) Holding the TSR over the last 1 year was 34%, which is better than the share price return mentioned above. The dividends paid by the company have thusly boosted the total shareholder return.

A Different Perspective

It's good to see that Tingyi (Cayman Islands) Holding has rewarded shareholders with a total shareholder return of 34% in the last twelve months. And that does include the dividend. Since the one-year TSR is better than the five-year TSR (the latter coming in at 7% per year), it would seem that the stock's performance has improved in recent times. 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 Tingyi (Cayman Islands) Holding better, we need to consider many other factors. Case in point: We've spotted 1 warning sign for Tingyi (Cayman Islands) Holding you should be aware of.

But note: Tingyi (Cayman Islands) Holding may not be the best stock to buy. So take a peek at this free list of interesting companies with past earnings growth (and further growth forecast).

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