Passive investing in an index fund is a good way to ensure your own returns roughly match the overall market. While individual stocks can be big winners, plenty more fail to generate satisfactory returns. Investors in John Wiley & Sons, Inc. (NYSE:WLY) have tasted that bitter downside in the last year, as the share price dropped 30%. That’s disappointing when you consider the market returned 14%. At least the damage isn’t so bad if you look at the last three years, since the stock is down 22% in that time.

Since shareholders are down over the longer term, lets look at the underlying fundamentals over the that time and see if they’ve been consistent with returns.

This technology could replace computers: discover the 20 stocks are working to make quantum computing a reality.

To paraphrase Benjamin Graham: Over the short term the market is a voting machine, but over the long term it’s a weighing machine. One flawed but reasonable way to assess how sentiment around a company has changed is to compare the earnings per share (EPS) with the share price.

John Wiley & Sons managed to increase earnings per share from a loss to a profit, over the last 12 months.

When a company has just transitioned to profitability, earnings per share growth is not always the best way to look at the share price action. But we may find different metrics more enlightening.

In contrast, the 8.5% drop in revenue is a real concern. Many investors see falling revenue as a likely precursor to lower earnings, so this could well explain the weak share price.

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

We know that John Wiley & Sons has improved its bottom line lately, but what does the future have in store? So it makes a lot of sense to check out what analysts think John Wiley & Sons will earn in the future (free profit forecasts).

It is important to consider the total shareholder return, as well as the share price return, for any given stock. 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. Arguably, the TSR gives a more comprehensive picture of the return generated by a stock. We note that for John Wiley & Sons the TSR over the last 1 year was -27%, which is better than the share price return mentioned above. This is largely a result of its dividend payments!

While the broader market gained around 14% in the last year, John Wiley & Sons shareholders lost 27% (even including dividends). Even the share prices of good stocks drop sometimes, but we want to see improvements in the fundamental metrics of a business, before getting too interested. On the bright side, long term shareholders have made money, with a gain of 5% per year over half a decade. It could be that the recent sell-off is an opportunity, so it may be worth checking the fundamental data for signs of a long term growth trend. While it is well worth considering the different impacts that market conditions can have on the share price, there are other factors that are even more important. Consider risks, for instance. Every company has them, and we’ve spotted 2 warning signs for John Wiley & Sons you should know about.