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Imagine Holding Temple & Webster Group (ASX:TPW) Shares While The Price Zoomed 787% Higher

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Temple & Webster Group Limited (ASX:TPW) shareholders might be concerned after seeing the share price drop 21% in the last month. But that doesn't displace its brilliant performance over three years. Over that time, we've been excited to watch the share price climb an impressive 787%. So the recent fall doesn't do much to dampen our respect for the business. Only time will tell if there is still too much optimism currently reflected in the share price.

It really delights us to see such great share price performance for investors.

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See our latest analysis for Temple & Webster Group

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 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).

During three years of share price growth, Temple & Webster Group moved from a loss to profitability. That kind of transition can be an inflection point that justifies a strong share price gain, just as we have seen here.

The image below shows how EPS has tracked over time (if you click on the image you can see greater detail).

ASX:TPW Past and Future Earnings, May 14th 2019
ASX:TPW Past and Future Earnings, May 14th 2019

We know that Temple & Webster Group has improved its bottom line over the last three years, but what does the future have in store? If you are thinking of buying or selling Temple & Webster Group stock, you should check out this FREE detailed report on its balance sheet.

A Different Perspective

We're pleased to report that Temple & Webster Group rewarded shareholders with a total shareholder return of 66% over the last year. But the three year TSR of 107% per year is even better. If you would like to research Temple & Webster Group in more detail then you might want to take a look at whether insiders have been buying or selling shares in the company.

If you would prefer to check out another company -- one with potentially superior financials -- then do not miss this free list of companies that have proven they can grow earnings.

Please note, the market returns quoted in this article reflect the market weighted average returns of stocks that currently trade on AU exchanges.

We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.

If you spot an error that warrants correction, please contact the editor at editorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading.