Extendicare's (TSE:EXE) five-year earnings growth trails the 29% YoY shareholder returns

When you buy shares in a company, it's worth keeping in mind the possibility that it could fail, and you could lose your money. But when you pick a company that is really flourishing, you can make more than 100%. Long term Extendicare Inc. (TSE:EXE) shareholders would be well aware of this, since the stock is up 167% in five years. It's even up 8.7% in the last week. After a strong gain in the past week, it's worth seeing if longer term returns have been driven by improving fundamentals. This technology could replace computers: discover the 20 stocks are working to make quantum computing a reality. There is no denying that markets are sometimes efficient, but prices do not always reflect underlying business performance. One imperfect but simple way to consider how the market perception of a company has shifted is to compare the change in the earnings per share (EPS) with the share price movement. During five years of share price growth, Extendicare achieved compound earnings per share (EPS) growth of 110% per year. The EPS growth is more impressive than the yearly share price gain of 22% over the same period. Therefore, it seems the market has become relatively pessimistic about the company. The graphic below depicts how EPS has changed over time (unveil the exact values by clicking on the image). TSX:EXE Earnings Per Share Growth September 24th 2025 We consider it positive that insiders have made significant purchases in the last year. Having said that, most people consider earnings and revenue growth trends to be a more meaningful guide to the business. Before buying or selling a stock, we always recommend a close examination of historic growth trends, available here.. What About Dividends? It is important to consider the total shareholder return, as well as the share price return, for any given stock. Whereas the share price return only reflects the change in the share price, the TSR includes the value of dividends (assuming they were reinvested) and the benefit of any discounted capital raising or spin-off. It's fair to say that the TSR gives a more complete picture for stocks that pay a dividend. We note that for Extendicare the TSR over the last 5 years was 264%, which is better than the share price return mentioned above. The dividends paid by the company have thusly boosted the total shareholder return. A Different Perspective It's nice to see that Extendicare shareholders have received a total shareholder return of 59% over the last year. That's including the dividend. That's better than the annualised return of 29% over half a decade, implying that the company is doing better recently. In the best case scenario, this may hint at some real business momentum, implying that now could be a great time to delve deeper. I find it very interesting to look at share price over the long term as a proxy for business performance. But to truly gain insight, we need to consider other information, too. Case in point: We've spotted 1 warning sign for Extendicare you should be aware of. There are plenty of other companies that have insiders buying up shares. You probably do not want to miss this free list of undervalued small cap companies that insiders are buying. Please note, the market returns quoted in this article reflect the market weighted average returns of stocks that currently trade on Canadian exchanges.