The worst result, after buying shares in a company (assuming no leverage), would be if you lose all the money you put in. But if you buy shares in a really great company, you can more than double your money. For example, the Pharma Mar, S.A. (BME:PHM) share price has soared 297% in the last three years. That sort of return is as solid as granite. On the other hand, we note it's down 9.8% in about a month .
While this past week has detracted from the company's three-year return, let's look at the recent trends of the underlying business and see if the gains have been in alignment .
View our latest analysis for Pharma Mar
In his essay The Superinvestors of Graham-and-Doddsville Warren Buffett described how share prices do not always rationally reflect the value of a business. One way to examine how market sentiment has changed over time is to look at the interaction between a company's share price and its earnings per share (EPS) . ...