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Shares worth €1.3bn (£1.1bn; $1.5bn) have been seized from the company that controls the manufacturer of Campari over alleged tax evasion, Italian police have said.

Officials ordered the confiscation of the Campari Group shares from Luxembourg-based Lagfin as part of a year-long investigation into how it absorbed its Italian arm.

It is accused of failing to pay a similar figure to that of the shares seized in taxes during that merger. The company previously said it had always fulfilled its tax obligations.

Campari – which also produces alcohol brands including Aperol, Grand Marnier and Courvoisier – said neither it nor its subsidiaries were involved in the case.

However, chair Luca Garavoglia is among those under investigation, local media reports.

The BBC approached Lagfin – which owns more than 50% of Campari shares and has 80% of voting rights – for comment.

It previously said in a statement issued on the investigation last year that it had “always fulfilled its tax obligations with the utmost scruples in all the jurisdictions where it operates” and considers any claims to the contrary “devoid of any basis”.

Prosecutors in Milan launched a probe into the company last year. Financial police on Friday said they allegedly found €5.3bn of undeclared capital gains between 2018 and 2020 on which it had not paid a so-called “exit tax”, levied on firms that transfer their headquarters abroad.

It is also accused of transferring its Italian assets into foreign ownership solely for tax purposes, according to Italian financial newspaper Il Sole 24 Ore.

Mr Garavoglia, the billionaire who inherited ownership of Campari from his late mother, is implicated alongside Giovanni Berto, the head of Campari’s Italian branch, local media reports.

One of the largest global producers of spirits, Campari is valued at around €7bn on the Milan Stock Exchange.

The company has its roots in 1860, when Gaspare Campari’s homemade bitter liqueur became a popular tipple among patrons of his Milan bar.

It became so successful that, in 1904, his family began manufacturing it commercially, and from the 1990s onwards the firm began acquiring other alcohol brands.

It hasn’t been the best quarter for TP ICAP Group PLC (LON:TCAP) shareholders, since the share price has fallen 14% in that time. But over the last three years returns have been decent. It beat the market return of 46% in that time, gaining 50%.

Now it’s worth having a look at the company’s fundamentals too, because that will help us determine if the long term shareholder return has matched the performance of the underlying business.

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While markets are a powerful pricing mechanism, share prices reflect investor sentiment, not just underlying business performance. One imperfect but simple way to consider how the market perception of a company has shifted is to compare the change in the earnings per share (EPS) with the share price movement.

During three years of share price growth, TP ICAP Group achieved compound earnings per share growth of 39% per year. The average annual share price increase of 14% is actually lower than the EPS growth. So it seems investors have become more cautious about the company, over time. This cautious sentiment is reflected in its (fairly low) P/E ratio of 11.16.

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

It is of course excellent to see how TP ICAP Group has grown profits over the years, but the future is more important for shareholders. You can see how its balance sheet has strengthened (or weakened) over time in this free interactive graphic.

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. Arguably, the TSR gives a more comprehensive picture of the return generated by a stock. We note that for TP ICAP Group the TSR over the last 3 years was 85%, which is better than the share price return mentioned above. And there’s no prize for guessing that the dividend payments largely explain the divergence!

We’re pleased to report that TP ICAP Group shareholders have received a total shareholder return of 25% over one year. And that does include the dividend. That’s better than the annualised return of 15% over half a decade, implying that the company is doing better recently. Someone with an optimistic perspective could view the recent improvement in TSR as indicating that the business itself is getting better with time. While it is well worth considering the different impacts that market conditions can have on the share price, there are other factors that are even more important. For instance, we’ve identified 2 warning signs for TP ICAP Group that you should be aware of.

Of course TP ICAP Group may not be the best stock to buy. So you may wish to see this free collection of growth stocks.

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