The main point of investing for the long term is to make money. But more than that, you probably want to see it rise more than the market average. Unfortunately for shareholders, while the Cass Information Systems, Inc. (NASDAQ:CASS) share price is up 13% in the last five years, that’s less than the market return. The last year has been disappointing, with the stock price down 11% in that time.

So let’s assess the underlying fundamentals over the last 5 years and see if they’ve moved in lock-step with shareholder returns.

Our free stock report includes 1 warning sign investors should be aware of before investing in Cass Information Systems. Read for free now.

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 five years of share price growth, Cass Information Systems actually saw its EPS drop 7.5% per year.

The strong decline in earnings per share suggests the market isn’t using EPS to judge the company. Given that EPS is down, but the share price is up, it seems clear the market is focussed on other aspects of the business, at the moment.

On the other hand, Cass Information Systems’ revenue is growing nicely, at a compound rate of 9.2% over the last five years. In that case, the company may be sacrificing current earnings per share to drive growth.

The image below shows how earnings and revenue have tracked over time (if you click on the image you can see greater detail).

Balance sheet strength is crucial. It might be well worthwhile taking a look at our free report on how its financial position has changed over time.

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. In the case of Cass Information Systems, it has a TSR of 29% for the last 5 years. That exceeds its share price return that we previously mentioned. This is largely a result of its dividend payments!

Investors in Cass Information Systems had a tough year, with a total loss of 8.8% (including dividends), against a market gain of about 6.1%. 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. It’s always interesting to track share price performance over the longer term. But to understand Cass Information Systems better, we need to consider many other factors. Take risks, for example – Cass Information Systems has 1 warning sign we think you should be aware of.