The most you can lose on a stock (assuming you don’t use leverage) is 100% of your money. But the good news is that if you buy shares of a high-quality company at the right price, you can gain well over 100%. For example, the price of Standex International Corporation (NYSE:SXI) has risen an impressive 157% over the past five years. Over the past week, the share price has risen 3.1%.

Last week was a lucrative one for Standex International investors, so let’s see if fundamentals drove the company’s five-year performance.

Check out our latest analysis for Standex International

To quote Buffett, “Ships will sail around the world, but the Flat Earth Society will flourish. There will continue to be huge discrepancies between price and value in the marketplace…” A flawed but reasonable way to assess how sentiment toward a company has changed is to compare earnings per share (EPS) to the share price.

Over half a decade, Standex International managed to grow its earnings per share by 10% per year. This EPS growth is lower than the average annual share price increase of 21%, so it’s safe to assume that the market has a higher opinion of the company than it did five years ago. And that’s hardly surprising given its growth track record.

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

The free Standex International’s interactive earnings, revenue and cash flow report is a good place to start if you want to investigate the stock further.

What about dividends?

In addition to measuring the share price return, investors should also consider the total shareholder return (TSR). The TSR includes the value of any spin-offs or discounted capital raisings, as well as any dividends, based on the assumption that the dividends are reinvested. So, for companies that pay a generous dividend, the TSR is often much higher than the share price return. We note that the TSR for Standex International over the last 5 years was 171%, which is better than the share price return mentioned above. This is largely due to the dividend payments!

A different perspective

Standex International shareholders have received a total return of 13% over the year. However, this return is below the market. On the positive side, the long-term returns (around 22% per year, over half a decade) look better. Perhaps the share price is just taking a breather while the company executes its growth strategy. While it is worth considering the different impacts that market conditions can have on the share price, there are other factors that are even more important. For example, we have found that 1 warning sign for Standex International that you should know.

The story continues

For those who like to find Successful investments The free A list of undervalued companies with recent insider buying might be just the thing.

Please note that the market returns quoted in this article reflect the market weighted average returns of stocks currently trading on U.S. exchanges.

Do you have feedback on this article? Are you concerned about the content? Contact us directly from us. Alternatively, send an email to editorial-team (at) simplywallst.com.

This Simply Wall St article is of a general nature. We comment solely on the basis of historical data and analyst forecasts, using an unbiased methodology. Our articles do not constitute financial advice. It is not a recommendation to buy or sell any stock and does not take into account your objectives or financial situation. Our goal is to provide you with long-term analysis based on fundamental data. Note that our analysis may not take into account the latest price-sensitive company announcements or qualitative materials. Simply Wall St does not hold any of the stocks mentioned.