The main goal of investing for the long term is to make money. Additionally, you would generally like to see the stock price rise faster than the market. Corn US Foods Holding Corp. (NYSE: USFD) failed to meet this second target, with the share price rising 22% over five years, which is below market performance. Unfortunately, the share price fell 1.7% last year.

Given that the stock added US $ 330 million to its market cap in the past week alone, let’s see if the underlying performance has generated any long-term returns.

See our latest analysis for US Foods Holding

It is undeniable that markets are sometimes efficient, but prices do not always reflect the underlying business performance. An imperfect but straightforward way to examine how a company’s market perception has changed is to compare the evolution of earnings per share (EPS) with the movement of the share price.

Over the five years of stock price growth, US Foods Holding has gone from loss to profitability. This would generally be viewed as positive, so we would expect the share price to rise.

The company’s earnings per share (over time) is shown in the image below (click to see exact numbers).

We know that US Foods Holding has improved its results lately, but will it increase its revenue? If you are interested, you can check this free report showing consensus revenue forecast.

A different perspective

US Foods Holding shareholders are down 1.7% for the year, but the market itself is up 23%. Even good stock prices drop sometimes, but we want to see improvements in the fundamentals of a business, before we get too interested. On the plus side, long-term shareholders made money, gaining 4% per year over half a decade. The recent sell-off may be an opportunity, so it may be worth checking the fundamentals for signs of a long-term growth trend. While it is worth considering the different impacts that market conditions can have on the share price, there are other factors that are even more important. Like risks, for example. Every business has them, and we’ve spotted 2 warning signs for US Foods Holding (1 of which cannot be ignored!) that you should know.

Sure, you might find a fantastic investment looking elsewhere. So take a look at this free list of companies that we believe will increase their profits.

Please note that the market returns quoted in this article reflect the market-weighted average returns of stocks that currently trade on the US stock exchanges.

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This Simply Wall St article is general in nature. We provide commentary based on historical data and analyst forecasts using only 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 into account your goals or your financial situation. Our aim is to bring you long-term, targeted analysis based on fundamental data. Note that our analysis may not take into account the latest announcements from price sensitive companies or qualitative documents. Simply Wall St has no position in any of the stocks mentioned.