Godo Steel, Ltd. (TSE:5410) shareholders might be concerned after seeing the share price drop 12% in the last month. But that doesn't undermine the rather lovely longer-term return, if you measure over the last three years. In fact, the share price is up a full 177% compared to three years ago. After a run like that some may not be surprised to see prices moderate. If the business can perform well for years to come, then the recent drop could be an opportunity.
The past week has proven to be lucrative for Godo Steel investors, so let's see if fundamentals drove the company's three-year performance.
Our free stock report includes 1 warning sign investors should be aware of before investing in Godo Steel. Read for free now.To quote Buffett, 'Ships will sail around the world but the Flat Earth Society will flourish. There will continue to be wide discrepancies between price and value in the marketplace...' 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.
During three years of share price growth, Godo Steel 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 company's earnings per share (over time) is depicted in the image below (click to see the exact numbers).
