First Financial Bankshares, Inc. (NASDAQ:FFIN) shareholders should be happy to see the share price up 27% in the last month. But that cannot eclipse the less-than-impressive returns over the last three years. Truth be told the share price declined 25% in three years and that return, Dear Reader, falls short of what you could have got from passive investing with an index fund.

The recent uptick of 16% could be a positive sign of things to come, so let's take a look at historical fundamentals.

View our latest analysis for First Financial Bankshares

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).

First Financial Bankshares saw its EPS decline at a compound rate of 3.5% per year, over the last three years. This reduction in EPS is slower than the 9% annual reduction in the share price. So it seems the market was too confident about the business, in the past.

You can see how EPS has changed over time in the image below (click on the chart to see the exact values).

It's probably worth noting we've seen significant insider buying in the last quarter, which we consider a positive. On the other hand, we think the revenue and earnings trends are much more meaningful measures of the business. It might be well worthwhile taking a look at our free report on First Financial Bankshares' earnings, revenue and cash flow.

What About Dividends?

When looking at investment returns, it is important to consider the difference between total shareholder return (TSR) and share price return. The TSR is a return calculation that accounts for the value of cash dividends (assuming that any dividend received was reinvested) and the calculated value of any discounted capital raisings and spin-offs. It's fair to say that the TSR gives a more complete picture for stocks that pay a dividend. We note that for First Financial Bankshares the TSR over the last 3 years was -21%, which is better than the share price return mentioned above. This is largely a result of its dividend payments!

A Different Perspective

First Financial Bankshares shareholders have received returns of 20% over twelve months (even including dividends), which isn't far from the general market return. That gain looks pretty satisfying, and it is even better than the five-year TSR of 4% per year. It is possible that management foresight will bring growth well into the future, even if the share price slows down. It is all well and good that insiders have been buying shares, but we suggest you check here to see what price insiders were buying at.