This month, we saw the Xingmin Intelligent Transportation Systems (Group) Co., Ltd. (SZSE:002355) up an impressive 57%. But that doesn't change the fact that the returns over the last five years have been less than pleasing. After all, the share price is down 41% in that time, significantly under-performing the market.

While the last five years has been tough for Xingmin Intelligent Transportation Systems (Group) shareholders, this past week has shown signs of promise. So let's look at the longer term fundamentals and see if they've been the driver of the negative returns.

Xingmin Intelligent Transportation Systems (Group) isn't currently profitable, so most analysts would look to revenue growth to get an idea of how fast the underlying business is growing. When a company doesn't make profits, we'd generally expect to see good revenue growth. That's because it's hard to be confident a company will be sustainable if revenue growth is negligible, and it never makes a profit.

In the last five years Xingmin Intelligent Transportation Systems (Group) saw its revenue shrink by 18% per year. That puts it in an unattractive cohort, to put it mildly. It seems pretty reasonable to us that the share price dipped 7% per year in that time. We doubt many shareholders are delighted with this share price performance. It is possible for businesses to bounce back but as Buffett says, 'turnarounds seldom turn'.

The image below shows how earnings and revenue have tracked over time (if you click on the image you can see greater detail).

It's probably worth noting that the CEO is paid less than the median at similar sized companies. But while CEO remuneration is always worth checking, the really important question is whether the company can grow earnings going forward. It might be well worthwhile taking a look at our free report on Xingmin Intelligent Transportation Systems (Group)'s earnings, revenue and cash flow.

A Different Perspective

It's nice to see that Xingmin Intelligent Transportation Systems (Group) shareholders have received a total shareholder return of 15% over the last year. That certainly beats the loss of about 7% per year over the last half decade. The long term loss makes us cautious, but the short term TSR gain certainly hints at a brighter future. 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. Case in point: We've spotted 1 warning sign for Xingmin Intelligent Transportation Systems (Group) you should be aware of.

Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of companies we expect will grow earnings.

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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