It can certainly be frustrating when a stock does not perform as hoped. But it's hard to avoid some disappointing investments when the overall market is down. The Zhongshan Public Utilities Group Co.,Ltd (SZSE:000685) is down 18% over three years, but the total shareholder return is -9.4% once you include the dividend. That's better than the market which declined 13% over the last three years. The falls have accelerated recently, with the share price down 11% in the last three months. However, one could argue that the price has been influenced by the general market, which is down 12% in the same timeframe.

With the stock having lost 4.4% in the past week, it's worth taking a look at business performance and seeing if there's any red flags.

See our latest analysis for Zhongshan Public Utilities GroupLtd

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.

Zhongshan Public Utilities GroupLtd saw its EPS decline at a compound rate of 3.8% per year, over the last three years. The share price decline of 6% is actually steeper than the EPS slippage. So it seems the market was too confident about the business, in the past. This increased caution is also evident in the rather low P/E ratio, which is sitting at 9.19.

The graphic below depicts how EPS has changed over time (unveil the exact values by clicking on the image).

Dive deeper into Zhongshan Public Utilities GroupLtd's key metrics by checking this interactive graph of Zhongshan Public Utilities GroupLtd's earnings, revenue and cash flow.

What About Dividends?

It is important to consider the total shareholder return, as well as the share price return, for any given stock. The TSR incorporates the value of any spin-offs or discounted capital raisings, along with any dividends, based on the assumption that the dividends are reinvested. It's fair to say that the TSR gives a more complete picture for stocks that pay a dividend. We note that for Zhongshan Public Utilities GroupLtd the TSR over the last 3 years was -9.4%, 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!

A Different Perspective

It's good to see that Zhongshan Public Utilities GroupLtd has rewarded shareholders with a total shareholder return of 10% in the last twelve months. And that does include the dividend. That gain is better than the annual TSR over five years, which is 4%. Therefore it seems like sentiment around the company has been positive lately. Given the share price momentum remains strong, it might be worth taking a closer look at the stock, lest you miss an opportunity. 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 risks, for instance. Every company has them, and we've spotted 2 warning signs for Zhongshan Public Utilities GroupLtd you should know about.

If you like to buy stocks alongside management, then you might just love this free list of companies. (Hint: insiders have been buying them).

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