A diverse equity portfolio will always have winners and losers. But if you want to beat the market as a whole, you have to have individual stocks that do better than you. Such a company is Las Vegas Sands Corp. (NYSE: LVS), whose share price rose 36% last year and slightly exceeded the market return of around 31% (excluding dividends). The longer-term returns are positive: the share price rose by 29% in three years.
Check out our latest analysis for Las Vegas Sands
To quote Buffett: Ships will sail around the world, but the Flat Earth Society will flourish. There will continue to be large discrepancies between price and value in the market … ”By comparing earnings per share (EPS) and changing share price over time, we can get a feel for how investors' attitudes are changing has changed a company over time.
In Las Vegas Sands, earnings per share even fell 49% last year.
Given the price gain, we doubt that the market will measure the progress of EPS. Since the change in EPS does not seem to correlate with the change in the share price, it is worth taking a look at other measures.
First of all, we suspect that the dividend, which was increased during the year, had a positive impact on the share price. The company may reach maturity and buy dividend investors for the yield, which drives up the price in the process.
The company's sales and earnings (over time) are shown in the image below (click to see the exact numbers).
Las Vegas Sands is well known to investors and many clever analysts have tried to predict future levels of earnings. Here you can see what analysts are predicting for Las Vegas Sands interactively Graph of future earnings estimates.
What about dividends?
It is important to consider the total return of shareholders as well as the return on a particular share. While the share price return only reflects the change in the share price, the TSR contains the value of the dividends (if these have been reinvested) and the benefit of a discounted capital raising or spin-off. It's fair to say that the TSR provides a more complete picture for stocks that pay dividends. We find the TSR for Las Vegas Sands was 43% last year, which is better than the stock price return mentioned above. And there is no price for the fact that the dividend payments largely explain the divergence!
It's good to see that Las Vegas Sands has given shareholders a total return of 43% over the past twelve months. Of course, this also includes the dividend. Since the one-year TSR is better than the five-year TSR (the latter is 10% per year), the stock's performance seems to have improved recently. Someone with an optimistic outlook could see the recent improvement in TSR as an indication that the business itself is getting better over time. Before you get an opinion on Las Vegas Sands, consider the cash it pays out as a dividend. This free Chart tracks its dividend over time.
We'll like Las Vegas Sands better when we see some big insider purchases. Check this while we wait free List of growing companies with significant recent insider purchases.
Please note that the market returns mentioned in this article reflect the market-weighted average returns on stocks currently traded on US stock exchanges.
If you discover an error that justifies a correction, please contact the editorial team at firstname.lastname@example.org. This article from Simply Wall St is general in nature. It is not a recommendation to buy or sell shares and does not take into account your goals or your financial situation. Simply Wall St has no position in the stocks mentioned.
We strive to provide you with long-term, focused research analysis based on fundamental data. Note that our analysis may not take into account the latest price-sensitive company announcements or quality material. Thank you for reading.