ACM Research's (NASDAQ:ACMR) investors will be pleased with their impressive 206% return over the last three years

Some ACM Research, Inc. (NASDAQ:ACMR) shareholders are probably rather concerned to see the share price fall 39% over the last three months. In contrast, the return over three years has been impressive. The share price marched upwards over that time, and is now 206% higher than it was. It's not uncommon to see a share price retrace a bit, after a big gain. If the business can perform well for years to come, then the recent drop could be an opportunity.

So let's investigate and see if the longer term performance of the company has been in line with the underlying business' progress.

Check out our latest analysis for ACM Research

While markets are a powerful pricing mechanism, share prices reflect investor sentiment, not just underlying business performance. By comparing earnings per share (EPS) and share price changes over time, we can get a feel for how investor attitudes to a company have morphed over time.

ACM Research was able to grow its EPS at 67% per year over three years, sending the share price higher. This EPS growth is higher than the 45% average annual increase in the share price. So it seems investors have become more cautious about the company, over time.

You can see how EPS has changed over time in the image below (click on the chart to see the exact values).

We know that ACM Research has improved its bottom line over the last three years, but what does the future have in store? If you are thinking of buying or selling ACM Research stock, you should check out this FREE detailed report on its balance sheet.

A Different Perspective

The last twelve months weren't great for ACM Research shares, which performed worse than the market, costing holders 33%. Meanwhile, the broader market slid about 0.6%, likely weighing on the stock. Fortunately the longer term story is brighter, with total returns averaging about 45% per year over three years. Sometimes when a good quality long term winner has a weak period, it's turns out to be an opportunity, but you really need to be sure that the quality is there. It's always interesting to track share price performance over the longer term. But to understand ACM Research better, we need to consider many other factors. Like risks, for instance. Every company has them, and we've spotted 3 warning signs for ACM Research (of which 1 is a bit unpleasant!) you should know about.

If you are like me, then you will not want to miss this free list of growing 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 US exchanges.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an 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 account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.