This week we saw the Shoe Carnival, Inc. (NASDAQ:SCVL) share price climb by 12%. But that is minimal compensation for the share price under-performance over the last year. The cold reality is that the stock has dropped 38% in one year, under-performing the market.

On a more encouraging note the company has added US$57m to its market cap in just the last 7 days, so let's see if we can determine what's driven the one-year loss for shareholders.

There is no denying that markets are sometimes efficient, but prices do not always reflect 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.

Unfortunately Shoe Carnival reported an EPS drop of 23% for the last year. This reduction in EPS is not as bad as the 38% share price fall. Unsurprisingly, given the lack of EPS growth, the market seems to be more cautious about the stock. The P/E ratio of 8.97 also points to the negative market sentiment.

You can see below how EPS has changed over time (discover the exact values by clicking on the image).

A Different Perspective

While the broader market gained around 19% in the last year, Shoe Carnival shareholders lost 37% (even including dividends). However, keep in mind that even the best stocks will sometimes underperform the market over a twelve month period. Regrettably, last year's performance caps off a bad run, with the shareholders facing a total loss of 1.1% per year over five years. We realise that Baron Rothschild has said investors should "buy when there is blood on the streets", but we caution that investors should first be sure they are buying a high quality business. It's always interesting to track share price performance over the longer term. But to understand Shoe Carnival better, we need to consider many other factors.

We will like Shoe Carnival better if we see some big insider buys.

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

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.