Union bank

City Union Bank (NSE: CUB) Five-Year Profit Growth Below 7.6% Annual Shareholder Return

If you buy and hold a stock for many years, you hope to make a profit. Better yet, you would like to see the stock price rise more than the market average. Corn City Union Bank Limited (NSE: CUB) failed to meet this second target, with the share price rising 43% over five years, which is below market performance. Over the past twelve months, the share price has risen by a very respectable 17%.

Given that the stock added 3.9 billion yen to its market cap in the last week alone, let’s see if the underlying performance has generated any long-term returns.

Check out our latest analysis for City Union Bank

While the efficient markets hypothesis continues to be taught by some, it has been proven that markets are overly responsive dynamic systems and investors are not always rational. An imperfect but reasonable way to gauge how sentiment is changing around a company is to compare earnings per share (EPS) with the stock price.

In five years, City Union Bank has managed to increase its earnings per share by 5.6% per year. This EPS growth is slower than the share price growth of 7% per year over the same period. This suggests that market participants hold society in the highest regard these days. And that’s hardly shocking given the growth history.

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

NSEI: CUB Growth in earnings per share October 26, 2021

It might be worth taking a look at our free City Union Bank profit, income and cash flow report.

A different perspective

City Union Bank shareholders are up 17% over the year (including dividends). But it was below the market average. On the bright side, the gain was actually greater than the average annual return of 8% per year over five years. This could indicate that the company is attracting new investors, while pursuing its strategy. Most investors take the time to verify insider trading data. You can click here to see if any insiders have bought or sold.

Sure City Union Bank may not be the best stock to buy. So you might want to see this free collection of growth stocks.

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

This Simply Wall St article is general in nature. We provide commentary based on historical data and analyst forecasts using only unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell shares and does not take into account your goals or your financial situation. Our aim is to bring you long-term, targeted analysis based on fundamental data. Note that our analysis may not take into account the latest announcements from price sensitive companies or qualitative documents. Simply Wall St has no position in any of the stocks mentioned.

Do you have any feedback on this item? Are you worried about the content? Get in touch with us directly. You can also send an email to the editorial team (at) simplywallst.com.