The most you can lose on any stock (assuming you don't use leverage) is 100% of your money. But in contrast you can make much more than 100% if the company does well. To wit, the Chongqing Mas Sci.&Tech.Co.,Ltd. (SZSE:300275) share price has flown 127% in the last three years. How nice for those who held the stock! On top of that, the share price is up 37% in about a quarter. But this could be related to the strong market, which is up 18% in the last three months.

On the back of a solid 7-day performance, let's check what role the company's fundamentals have played in driving long term shareholder returns.

To quote Buffett, 'Ships will sail around the world but the Flat Earth Society will flourish. There will continue to be wide discrepancies between price and value in the marketplace...' One flawed but reasonable way to assess how sentiment around a company has changed is to compare the earnings per share (EPS) with the share price.

During three years of share price growth, Chongqing Mas Sci.&Tech.Co.Ltd achieved compound earnings per share growth of 24% per year. This EPS growth is lower than the 31% average annual increase in the share price. This indicates that the market is feeling more optimistic on the stock, after the last few years of progress. It is quite common to see investors become enamoured with a business, after a few years of solid progress. This optimism is also reflected in the fairly generous P/E ratio of 77.19.

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

We know that Chongqing Mas Sci.&Tech.Co.Ltd has improved its bottom line lately, but is it going to grow revenue? Check if analysts think Chongqing Mas Sci.&Tech.Co.Ltd will grow revenue in the future.

A Different Perspective

Chongqing Mas Sci.&Tech.Co.Ltd's TSR for the year was broadly in line with the market average, at 6.8%. We should note here that the five-year TSR is more impressive, at 18% per year. More recently, the share price growth has slowed. But it has to be said the overall picture is one of good long term and short term performance. Arguably that makes Chongqing Mas Sci.&Tech.Co.Ltd a stock worth watching. I find it very interesting to look at share price over the long term as a proxy for business performance. But to truly gain insight, we need to consider other information, too. For instance, we've identified 1 warning sign for Chongqing Mas Sci.&Tech.Co.Ltd that 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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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.