Many investors define successful investing as beating the market average over the long term. But if you try your hand at stock picking, you risk returning less than the market. Unfortunately, that’s been the case for longer term HRnetGroup Limited (SGX:CHZ) shareholders, since the share price is down 13% in the last three years, falling well short of the market return of around 22%.

Now let’s have a look at the company’s fundamentals, and see if the long term shareholder return has matched the performance of the underlying business.

View our latest analysis for HRnetGroup

There is no denying that markets are sometimes efficient, but prices do not always reflect underlying business performance. 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.

During the three years that the share price fell, HRnetGroup’s earnings per share (EPS) dropped by 1.9% each year. This reduction in EPS is slower than the 5% annual reduction in the share price. So it’s likely that the EPS decline has disappointed the market, leaving investors hesitant to buy. The less favorable sentiment is reflected in its current P/E ratio of 11.70.

You can see how EPS has changed over time in the image below (click on the chart to see the exact values).

It might be well worthwhile taking a look at our free report on HRnetGroup’s earnings, revenue and cash flow.

As well as measuring the share price return, investors should also consider the total shareholder return (TSR). Whereas the share price return only reflects the change in the share price, the TSR includes the value of dividends (assuming they were reinvested) and the benefit of any discounted capital raising or spin-off. So for companies that pay a generous dividend, the TSR is often a lot higher than the share price return. In the case of HRnetGroup, it has a TSR of 3.2% for the last 3 years. That exceeds its share price return that we previously mentioned. This is largely a result of its dividend payments!

HRnetGroup shareholders gained a total return of 2.2% 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 8% over five years. It’s quite possible the business continues to execute with prowess, even as the share price gains are slowing. Importantly, we haven’t analysed HRnetGroup’s dividend history. This free visual report on its dividends is a must-read if you’re thinking of buying.