Investing in stocks comes with the risk that the share price will fall. Unfortunately, shareholders of Thelloy Development Group Limited (HKG:1546) have suffered share price declines over the last year. To wit the share price is down 65% in that time. Notably, shareholders had a tough run over the longer term, too, with a drop of 49% in the last three years. The falls have accelerated recently, with the share price down 33% in the last three months. But this could be related to the weak market, which is down 14% in the same period.

View our latest analysis for Thelloy Development Group

While the efficient markets hypothesis continues to be taught by some, it has been proven that markets are over-reactive dynamic systems, and investors are not always rational. 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.

Unfortunately Thelloy Development Group reported an EPS drop of 23% for the last year. The share price decline of 65% is actually more than the EPS drop. So it seems the market was too confident about the business, a year ago. The P/E ratio of 4.60 also points to the negative market sentiment.

You can see below how EPS has changed over time (discover the exact values by clicking on the image).

It might be well worthwhile taking a look at our free report on Thelloy Development Group's earnings, revenue and cash flow.

What About Dividends?

When looking at investment returns, it is important to consider the difference between total shareholder return (TSR) and share price return. The TSR is a return calculation that accounts for the value of cash dividends (assuming that any dividend received was reinvested) and the calculated value of any discounted capital raisings and spin-offs. Arguably, the TSR gives a more comprehensive picture of the return generated by a stock. In the case of Thelloy Development Group, it has a TSR of -63% for the last year. That exceeds its share price return that we previously mentioned. The dividends paid by the company have thusly boosted the total shareholder return.

A Different Perspective

Thelloy Development Group shareholders are down 63% for the year (even including dividends) , falling short of the market return. The market shed around 15%, no doubt weighing on the stock price. The three-year loss of 15% per year isn't as bad as the last twelve months, suggesting that the company has not been able to convince the market it has solved its problems. We would be wary of buying into a company with unsolved problems, although some investors will buy into struggling stocks if they believe the price is sufficiently attractive. It's always interesting to track share price performance over the longer term. But to understand Thelloy Development Group better, we need to consider many other factors. For example, we've discovered 4 warning signs for Thelloy Development Group that you should be aware of before investing here.