Air Transport Services Group (NASDAQ: ATSG) Five-Year Profit Growth Less Than 14% YoY for Shareholders

The main goal 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 the shareholders, while the Airline Services Group, Inc. The stock price (NASDAQ: ATSG) has risen 89% over the past five years, less than the market performance. Zooming in, the stock is actually down 16% last year.

As it has been a strong week for Air Transport Services Group shareholders, let’s take a look at longer term fundamentals.

See our latest analysis for Air Transport Services Group

While the efficient markets hypothesis continues to be taught by some, it has been proven that markets are overly responsive dynamic systems and investors are not always rational. By comparing earnings per share (EPS) and changes in stock prices over time, we can get a sense of how investors’ attitudes towards a company have changed over time.

During the five years of share price growth, Air Transport Services Group achieved compound earnings per share (EPS) growth of 21% per year. EPS growth is more impressive than the annual share price gain of 14% over the same period. Therefore, it seems that the market has become relatively pessimistic about the company.

The company’s earnings per share (over time) is shown in the image below (click to see exact numbers).

NasdaqGS: Growth in earnings per share of ATSG October 27, 2021

We know Air Transport Services Group has improved its results lately, but will it increase its revenue? This free A report showing analysts’ revenue forecasts should help you determine if EPS growth can be sustained.

A different perspective

Air Transport Services Group shareholders are down 16% on the year, but the market itself is up 35%. However, keep in mind that even the best stocks will sometimes underperform the market over a twelve month period. On the plus side, long-term shareholders have made money, gaining 14% per year over half a decade. The recent sell-off may be an opportunity, so it may be worth checking the fundamentals for signs of a long-term growth trend. While it is worth considering the different impacts that market conditions can have on the share price, there are other factors that are even more important. Like risks, for example. Every business has them, and we’ve spotted 4 warning signs for Air Transport Services Group (1 of which makes us a little uncomfortable!) to know.

If you would rather consult with another company – one with potentially superior finances – then don’t miss this free list of companies that have proven that they can increase their profits.

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

This Simply Wall St article is general in nature. We provide commentary based on historical data and analyst forecasts using only 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 into account your goals or your financial situation. Our aim is to bring you long-term, targeted analysis based on fundamental data. Note that our analysis may not take into account the latest announcements from price sensitive companies or qualitative documents. Simply Wall St has no position in any of the stocks mentioned.

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