If you are building a properly diversified stock portfolio, the chances are some of your picks will perform badly. But the last three years have been particularly tough on longer term Pingtan Marine Enterprise Ltd. (NASDAQ:PME) shareholders. Unfortunately, they have held through a 63% decline in the share price in that time. Furthermore, it’s down 43% in about a quarter. That’s not much fun for holders.
To paraphrase Benjamin Graham: Over the short term the market is a voting machine, but over the long term it’s a weighing machine. By comparing earnings per share (EPS) and share price changes over time, we can get a feel for how investor attitudes to a company have morphed over time.
Pingtan Marine Enterprise saw its EPS decline at a compound rate of 44% per year, over the last three years. This fall in the EPS is worse than the 28% compound annual share price fall. So, despite the prior disappointment, shareholders must have some confidence the situation will improve, longer term.
The graphic below depicts how EPS has changed over time (unveil the exact values by clicking on the image).
We’re pleased to report that the CEO is remunerated more modestly than most CEOs at similarly capitalized companies. But while CEO remuneration is always worth checking, the really important question is whether the company can grow earnings going forward. It might be well worthwhile taking a look at our free report on Pingtan Marine Enterprise’s earnings, revenue and cash flow.
A Different Perspective
Pingtan Marine Enterprise provided a TSR of 10% over the last twelve months. But that was short of the market average. But at least that’s still a gain! Over five years the TSR has been a reduction of 3% per year, over five years. So this might be a sign the business has turned its fortunes around. It’s always interesting to track share price performance over the longer term. But to understand Pingtan Marine Enterprise better, we need to consider many other factors. Like risks, for instance. Every company has them, and we’ve spotted 6 warning signs for Pingtan Marine Enterprise (of which 3 make us uncomfortable!) you should know about.
We will like Pingtan Marine Enterprise better if we see some big insider buys. While we wait, check out this free list of growing companies with considerable, recent, insider buying.
Please note, the market returns quoted in this article reflect the market weighted average returns of stocks that currently trade on US exchanges.
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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. 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.
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