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The simplest way to invest in stocks is to buy exchange traded funds. But if you pick the right individual stocks, you could make more than that. For example, the Ingevity Corporation ( NYSE:NGVT ) share price is up 51% in the last year, clearly besting than the market return of around 9.0% (not including dividends). If it can keep that out-performance up over the long term, investors will do very well! We'll need to follow Ingevity for a while to get a better sense of its share price trend, since it hasn't been listed for particularly long.
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 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).
Ingevity was able to grow EPS by 34% in the last twelve months. This EPS growth is significantly lower than the 51% increase in the share price. So it's fair to assume the market has a higher opinion of the business than it a year ago.
The company's earnings per share (over time) is depicted in the image below (click to see the exact numbers).
We know that Ingevity has improved its bottom line lately, but is it going to grow revenue? Check if analysts think Ingevity will grow revenue in the future.
A Different Perspective
It's nice to see that Ingevity shareholders have gained 51% over the last year. A substantial portion of that gain has come in the last three months, with the stock up 33% in that time. This suggests the company is continuing to win over new investors. If you would like to research Ingevity in more detail then you might want to take a look at whether insiders have been buying or selling shares in the company.
Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of companies we expect will grow earnings.
Please note, the market returns quoted in this article reflect the market weighted average returns of stocks that currently trade on US 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 firstname.lastname@example.org . 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.