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It hasn't been the best quarter for AdaptHealth Corp. (NASDAQ:AHCO) shareholders, since the share price has fallen 15% in that time. But at least the stock is up over the last year. In that time, it is up 13%, which isn't bad, but is below the market return of 35%.
Let's take a look at the underlying fundamentals over the longer term, and see if they've been consistent with shareholders returns.
To paraphrase Benjamin Graham: Over the short term the market is a voting machine, but over the long term it's a weighing machine. 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 last year AdaptHealth grew its earnings per share (EPS) by 43%. We note, however, that extraordinary items have impacted earnings. This EPS growth is significantly higher than the 13% increase in the share price. So it seems like the market has cooled on AdaptHealth, despite the growth. Interesting.
You can see how EPS has changed over time in the image below (click on the chart to see the exact values).
We like that insiders have been buying shares in the last twelve months. Having said that, most people consider earnings and revenue growth trends to be a more meaningful guide to the business. Before buying or selling a stock, we always recommend a close examination of historic growth trends, available here..
A Different Perspective
We're happy to report that AdaptHealth are up 13% over the year. The bad news is that's no better than the average market return, which was roughly 35%. The last three months haven't been great for shareholder returns, since the share price has trailed the market by 16% in the last three months. It might be that investors are more concerned about the business lately due to some fundamental change (or else the share price simply got ahead of itself, previously). I find it very interesting to look at share price over the long term as a proxy for business performance. But to truly gain insight, we need to consider other information, too. Even so, be aware that AdaptHealth is showing 3 warning signs in our investment analysis , and 1 of those doesn't sit too well with us...
There are plenty of other companies that have insiders buying up shares. You probably do not want to miss this free list of growing companies that insiders are buying.
Please note, the market returns quoted in this article reflect the market weighted average returns of stocks that currently trade on US exchanges.
This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
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