Passive investing in index funds can generate returns that roughly match the overall market. But one can do better than that by picking better than average stocks (as part of a diversified portfolio). For example, the Sing Holdings Limited (SGX:5IC) share price is up 50% in the last 1 year, clearly besting the market return of around 25% (not including dividends). So that should have shareholders smiling. It is also impressive that the stock is up 40% over three years, adding to the sense that it is a real winner.

Let’s take a look at the underlying fundamentals over the longer term, and see if they’ve been consistent with shareholders returns.

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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. 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.

Sing Holdings was able to grow EPS by 51% in the last twelve months. This EPS growth is remarkably close to the 50% increase in the share price. That suggests that the market sentiment around the company hasn’t changed much over that time. It looks like the share price is responding to the EPS.

The graphic below depicts how EPS has changed over time (unveil the exact values by clicking on the image).

This free interactive report on Sing Holdings’ earnings, revenue and cash flow is a great place to start, if you want to investigate the stock further.

As well as measuring the share price return, investors should also consider the total shareholder return (TSR). 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. So for companies that pay a generous dividend, the TSR is often a lot higher than the share price return. As it happens, Sing Holdings’ TSR for the last 1 year was 54%, which exceeds the share price return mentioned earlier. And there’s no prize for guessing that the dividend payments largely explain the divergence!

It’s good to see that Sing Holdings has rewarded shareholders with a total shareholder return of 54% in the last twelve months. And that does include the dividend. That’s better than the annualised return of 10% over half a decade, implying that the company is doing better recently. Given the share price momentum remains strong, it might be worth taking a closer look at the stock, lest you miss an opportunity. It’s always interesting to track share price performance over the longer term. But to understand Sing Holdings better, we need to consider many other factors. Like risks, for instance. Every company has them, and we’ve spotted 3 warning signs for Sing Holdings (of which 1 can’t be ignored!) you should know about.