If you buy and hold a stock for many years, you’d hope to be making a profit. Furthermore, you’d generally like to see the share price rise faster than the market. Unfortunately for shareholders, while the Adient plc (NYSE:ADNT) share price is up 25% in the last five years, that’s less than the market return. Meanwhile, the last twelve months saw the share price rise 4.0%.

Now it’s worth having a look at the company’s fundamentals too, because that will help us determine if the long term shareholder return has matched the performance of the underlying business.

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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. One way to examine how market sentiment has changed over time is to look at the interaction between a company’s share price and its earnings per share (EPS).

We know that Adient has been profitable in the past. On the other hand, it reported a trailing twelve months loss, suggesting it isn’t reliably profitable. So we might find other metrics can better explain the share price movements.

On the other hand, Adient’s revenue is growing nicely, at a compound rate of 3.2% over the last five years. It’s quite possible that management are prioritizing revenue growth over EPS growth at the moment.

The company’s revenue and earnings (over time) are depicted in the image below (click to see the exact numbers).

Adient is a well known stock, with plenty of analyst coverage, suggesting some visibility into future growth. Given we have quite a good number of analyst forecasts, it might be well worth checking out this free chart depicting consensus estimates.

Adient shareholders gained a total return of 4.0% during the year. But that return falls short of the market. It’s probably a good sign that the company has an even better long term track record, having provided shareholders with an annual TSR of 5% over five years. It may well be that this is a business worth popping on the watching, given the continuing positive reception, over time, from the market. I find it very interesting to look at share price over the long term as a proxy for business performance. But to truly gain insight, we need to consider other information, too. Consider risks, for instance. Every company has them, and we’ve spotted 1 warning sign for Adient you should know about.