It is doubtless a positive to see that the Rayitek Hi-Tech Film Company Ltd., Shenzhen (SHSE:688323) share price has gained some 40% in the last three months. But that is minimal compensation for the share price under-performance over the last year. After all, the share price is down 27% in the last year, significantly under-performing the market.

Although the past week has been more reassuring for shareholders, they're still in the red over the last year, so let's see if the underlying business has been responsible for the decline.

Check out our latest analysis for Rayitek Hi-Tech Film Company Shenzhen

To paraphrase Benjamin Graham: Over the short term the market is a voting machine, but over the long term it's a weighing machine. 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 Rayitek Hi-Tech Film Company Shenzhen reported an EPS drop of 39% for the last year. This fall in the EPS is significantly worse than the 27% the share price fall. So despite the weak per-share profits, some investors are probably relieved the situation wasn't more difficult. Indeed, with a P/E ratio of 99.18 there is obviously some real optimism that earnings will bounce back.

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

Dive deeper into Rayitek Hi-Tech Film Company Shenzhen's key metrics by checking this interactive graph of Rayitek Hi-Tech Film Company Shenzhen's earnings, revenue and cash flow.

A Different Perspective

Rayitek Hi-Tech Film Company Shenzhen shareholders are down 27% for the year (even including dividends), even worse than the market loss of 5.9%. That's disappointing, but it's worth keeping in mind that the market-wide selling wouldn't have helped. It's great to see a nice little 40% rebound in the last three months. This could just be a bounce because the selling was too aggressive, but fingers crossed it's the start of a new trend. 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. Consider for instance, the ever-present spectre of investment risk. We've identified 2 warning signs with Rayitek Hi-Tech Film Company Shenzhen , and understanding them should be part of your investment process.

If you are like me, then you will not want to miss this free list of growing companies that insiders are buying.

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