If you buy and hold a stock for many years, you'd hope to be making a profit. Furthermore, you'd generally like to see the share price rise faster than the market. Unfortunately for shareholders, while the HealthEquity, Inc. (NASDAQ:HQY) share price is up 29% in the last five years, that's less than the market return. Over the last twelve months the stock price has risen a very respectable 9.3%.

Since the stock has added US$250m to its market cap in the past week alone, let's see if underlying performance has been driving long-term returns.

See our latest analysis for HealthEquity

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.

During the last half decade, HealthEquity became profitable. That's generally thought to be a genuine positive, so investors may expect to see an increasing share price.

The graphic below depicts how EPS has changed over time (unveil the exact values by clicking on the image).

We know that HealthEquity has improved its bottom line over the last three years, but what does the future have in store? This free interactive report on HealthEquity's balance sheet strength is a great place to start, if you want to investigate the stock further.

A Different Perspective

HealthEquity shareholders gained a total return of 9.3% during the year. But that return falls short of the market. The silver lining is that the gain was actually better than the average annual return of 5% per year over five year. This suggests the company might be improving over time. Before spending more time on HealthEquity it might be wise to click here to see if insiders have been buying or selling shares.

We will like HealthEquity better if we see some big insider buys. While we wait, check out this free list of undervalued stocks (mostly small caps) with considerable, recent, insider buying.

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