Izhstal PAO (MCX:IGST) shareholders might be concerned after seeing the share price drop 24% in the last quarter. But that doesn't change the fact that the returns over the last five years have been respectable. After all, the stock has performed better than the market (85%) in that time, and is up 88%. Unfortunately not all shareholders will have held it for five years, so spare a thought for those caught in the 39% decline over the last three years: that's a long time to wait for profits.

Check out our latest analysis for Izhstal PAO

There is no denying that markets are sometimes efficient, but prices do not always reflect underlying business performance. 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 the last half decade, Izhstal PAO became profitable. That would generally be considered a positive, so we'd expect the share price to be up. Since the company was unprofitable five years ago, but not three years ago, it's worth taking a look at the returns in the last three years, too. We can see that the Izhstal PAO share price is down 39% in the last three years. In the same period, EPS is up 69% per year. So there seems to be a mismatch between the positive EPS growth and the change in the share price, which is down -15% per year.

You can see how EPS has changed over time in the image below (click on the chart to see the exact values).

Dive deeper into Izhstal PAO's key metrics by checking this interactive graph of Izhstal PAO's earnings, revenue and cash flow.

A Different Perspective

Investors in Izhstal PAO had a tough year, with a total loss of 26%, against a market gain of about 0.6%. 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. Longer term investors wouldn't be so upset, since they would have made 13%, each year, over five years. If the fundamental data continues to indicate long term sustainable growth, the current sell-off could be an opportunity worth considering. 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. Even so, be aware that Izhstal PAO is showing 3 warning signs in our investment analysis , and 2 of those are concerning...

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

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