The main aim of stock picking is to find the market-beating stocks. But in any portfolio, there will be mixed results between individual stocks. So we wouldn't blame long term Chengdu Road & Bridge Engineering CO.,LTD (SZSE:002628) shareholders for doubting their decision to hold, with the stock down 42% over a half decade. And it's not just long term holders hurting, because the stock is down 28% in the last year. Unfortunately the share price momentum is still quite negative, with prices down 20% in thirty days. But this could be related to poor market conditions -- stocks are down 13% in the same time.

If the past week is anything to go by, investor sentiment for Chengdu Road & Bridge EngineeringLTD isn't positive, so let's see if there's a mismatch between fundamentals and the share price.

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

Chengdu Road & Bridge EngineeringLTD became profitable within the last five years. That would generally be considered a positive, so we are surprised to see the share price is down. Other metrics may better explain the share price move.

The modest 0.9% dividend yield is unlikely to be guiding the market view of the stock. It could be that the revenue decline of 18% per year is viewed as evidence that Chengdu Road & Bridge EngineeringLTD is shrinking. That could explain the weak share price.

The graphic below depicts how earnings and revenue have changed over time (unveil the exact values by clicking on the image).

If you are thinking of buying or selling Chengdu Road & Bridge EngineeringLTD stock, you should check out this FREE detailed report on its balance sheet.

A Different Perspective

The total return of 28% received by Chengdu Road & Bridge EngineeringLTD shareholders over the last year isn't far from the market return of -26%. So last year was actually even worse than the last five years, which cost shareholders 7% per year. Weak performance over the long term usually destroys market confidence in a stock, but bargain hunters may want to take a closer look for signs of a turnaround. It's always interesting to track share price performance over the longer term. But to understand Chengdu Road & Bridge EngineeringLTD better, we need to consider many other factors. To that end, you should learn about the 3 warning signs we've spotted with Chengdu Road & Bridge EngineeringLTD (including 2 which are a bit unpleasant) .

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 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.