W
e believe investing in the stock market is a smart move, as history shows that markets tend to rise over time. However, not every stock will perform equally well. For instance, Summit Real Estate Holdings Ltd (TLV:SMT) has seen its share price increase by 23% over the last year, but this gain lags behind the overall market return. Over a longer period, the company's performance is less impressive, with a decline of 18% in the past three years. Given that the stock dropped 5.0% in the past week, we want to examine its long-term story and determine if fundamentals have driven its recent positive returns.

    To understand investor attitudes towards Summit Real Estate Holdings, let's compare earnings per share (EPS) and share price changes over time. The company has transitioned from a loss-making entity to one that reports profits, which can be an attractive feature for investors. However, when a company is on the cusp of profitability, it's essential to consider other metrics to accurately gauge growth and understand share price movements.

    We're skeptical about the 0.6% dividend yield being a significant draw for buyers. Revenue has been relatively flat year-over-year, but a closer look at the data might explain market optimism. The image below shows how earnings and revenue have tracked over time (click on the image to see greater detail).

    A key aspect of evaluating Summit Real Estate Holdings is its CEO's remuneration, which is more modest than that of most CEOs at similarly capitalized companies. Nevertheless, a more critical question is whether the company will sustainably grow its earnings in the years to come.

    This free interactive report on Summit Real Estate Holdings' earnings, revenue, and cash flow provides a great starting point for further investigation. A Different Perspective

    Summit Real Estate Holdings has provided a total shareholder return (TSR) of 24% over the last twelve months, which is below the market average. However, this still represents a gain, and it's better than the average return of 2% over half a decade. It's possible that returns will improve as business fundamentals strengthen.

    To gain a deeper understanding of Summit Real Estate Holdings, we need to consider various factors, including risks. Every company has them, and we've identified 3 warning signs for Summit Real Estate Holdings (of which 2 are potentially serious!) that you should be aware of. We'll have a more favorable view of the company if we see significant insider buying. In the meantime, check out this free list of undervalued stocks with considerable, recent insider buying.