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Dubai Financial Market P.J.S.C's (DFM:DFM) five-year earnings growth trails the splendid shareholder returns

Simply Wall St · 06/26 02:01

The most you can lose on any stock (assuming you don't use leverage) is 100% of your money. But on a lighter note, a good company can see its share price rise well over 100%. For instance, the price of Dubai Financial Market P.J.S.C. (DFM:DFM) stock is up an impressive 102% over the last five years. Also pleasing for shareholders was the 23% gain in the last three months.

On the back of a solid 7-day performance, let's check what role the company's fundamentals have played in driving long term shareholder returns.

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While markets are a powerful pricing mechanism, share prices reflect investor sentiment, not just underlying business performance. 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).

Over half a decade, Dubai Financial Market P.J.S.C managed to grow its earnings per share at 27% a year. The EPS growth is more impressive than the yearly share price gain of 15% over the same period. So one could conclude that the broader market has become more cautious towards the stock.

The company's earnings per share (over time) is depicted in the image below (click to see the exact numbers).

earnings-per-share-growth
DFM:DFM Earnings Per Share Growth June 26th 2025

We know that Dubai Financial Market P.J.S.C has improved its bottom line over the last three years, but what does the future have in store? If you are thinking of buying or selling Dubai Financial Market P.J.S.C stock, you should check out this FREE detailed report on its balance sheet.

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. So for companies that pay a generous dividend, the TSR is often a lot higher than the share price return. In the case of Dubai Financial Market P.J.S.C, it has a TSR of 118% for the last 5 years. That exceeds its share price return that we previously mentioned. This is largely a result of its dividend payments!

A Different Perspective

It's good to see that Dubai Financial Market P.J.S.C has rewarded shareholders with a total shareholder return of 32% in the last twelve months. Of course, that includes the dividend. That's better than the annualised return of 17% over half a decade, implying that the company is doing better recently. Someone with an optimistic perspective could view the recent improvement in TSR as indicating that the business itself is getting better with time. Is Dubai Financial Market P.J.S.C cheap compared to other companies? These 3 valuation measures might help you decide.

Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of companies we expect will grow earnings.

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