Knorr-Bremse AG: A closer look at the impressive returns

Knorr-Bremse AG: A closer look at the impressive returns

While investing in index funds can generate returns roughly in line with the overall market, there are ways to make adjustments to select above-average stocks to significantly increase returns. An example of this is theKnorr-Bremse AG(ETR:KBX), whose share price has risen 38% in the last year. This exceeds the general market development of around 14%, without taking dividends into account - a remarkable success!

However, long-term returns show that the share price is down 11% compared to three years ago. This discrepancy raises questions about the company's underlying secrets. Matthias Beck, a corporate finance analyst, examined changes in this data and found that Knorr-Bremse increased its earnings per share (EPS) by 18% last year. However, this does not match the share price increase of 38%, which suggests that market sentiment has become more confident.

Dividends and total return

A thorough consideration of total shareholder return is crucial. While the price return is 38%, the total return, which also takes the dividend into account, is an impressive 41%. This difference is largely due to the dividend payments, which represent an attractive source of income for many investors.

Over the last twelve months, Knorr-Bremse has not only rewarded investors through rising share prices, but also through regular distributions. Historically, the public company has performed with a total return of just 1.2% per year over the past five years. This means that the company's performance has improved significantly in the recent past.

An exciting aspect is the development of the share price over a longer period of time. This could serve as an indicator of the company's actual business performance. However, a warning sign suddenly appears in Knorr-Bremse's investor analysis that could be important for potential investors. Investors should therefore be well informed before making a decision.

In summary, Knorr-Bremse is showing a positive trend and investors can look back confidently on a growing market. However, anyone who decides to invest should also pay attention to other factors and possible risks. This could help make the best decisions to benefit from positive market developments. For further information about Knorr-Bremse's financial position and prospects, various analyzes provide deeper insights that may be valuable to interested investors according to information from Simply Wall St.