dormakaba Holding (VTX:DOKA) shareholders notch a 24% CAGR over 3 years, yet earnings have been shrinking

One simple way to benefit from the stock market is to buy an index fund. But if you choose individual stocks with prowess, you can make superior returns. For example, dormakaba Holding AG (VTX:DOKA) shareholders have seen the share price rise 76% over three years, well in excess of the market return (2.8%, not including dividends). However, more recent returns haven't been as impressive as that, with the stock returning just 61% in the last year, including dividends.

On the back of a solid 7-day performance, let's check what role the company's fundamentals have played in driving long term shareholder returns.

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While the efficient markets hypothesis continues to be taught by some, it has been proven that markets are over-reactive dynamic systems, and investors are not always rational. One flawed but reasonable way to assess how sentiment around a company has changed is to compare the earnings per share (EPS) with the share price.

Over the last three years, dormakaba Holding failed to grow earnings per share, which fell 13% (annualized).

Thus, it seems unlikely that the market is focussed on EPS growth at the moment. Therefore, we think it's worth considering other metrics as well.

Languishing at just 1.0%, we doubt the dividend is doing much to prop up the share price. We severely doubt anyone is particularly impressed with the modest 2.2% three-year revenue growth rate. While we don't have an obvious theory to explain the share price rise, a closer look at the data might be enlightening.

The graphic below depicts how earnings and revenue have changed over time (unveil the exact values by clicking on the image).SWX:DOKA Earnings and Revenue Growth August 13th 2025

We know that dormakaba Holding has improved its bottom line lately, but what does the future have in store? So we recommend checking out this freereport showing consensus forecasts

What About Dividends?

As well as measuring the share price return, investors should also consider the total shareholder return (TSR). 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. In the case of dormakaba Holding, it has a TSR of 89% for the last 3 years. That exceeds its share price return that we previously mentioned. The dividends paid by the company have thusly boosted the total shareholder return.

Story Continues

A Different Perspective

It's good to see that dormakaba Holding has rewarded shareholders with a total shareholder return of 61% in the last twelve months. That's including the dividend. That's better than the annualised return of 11% 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. It's always interesting to track share price performance over the longer term. But to understand dormakaba Holding better, we need to consider many other factors. For example, we've discovered 2 warning signs for dormakaba Holding that you should be aware of before investing here.

Of course dormakaba Holding may not be the best stock to buy. So you may wish to see this freecollection of growth stocks.

Please note, the market returns quoted in this article reflect the market weighted average returns of stocks that currently trade on Swiss 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.

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