Unless you borrow money to invest, the potential losses are limited. But if you pick the right stock, you can make a lot more than 100%. For example, the CPT Technology (Group) Co.,Ltd (SZSE:000536) share price has soared 156% in the last 1 year. Most would be very happy with that, especially in just one year! Better yet, the share price has gained 159% in the last quarter. And shareholders have also done well over the long term, with an increase of 137% in the last three years.

The past week has proven to be lucrative for CPT Technology (Group)Ltd investors, so let's see if fundamentals drove the company's one-year performance.

See our latest analysis for CPT Technology (Group)Ltd

Given that CPT Technology (Group)Ltd didn't make a profit in the last twelve months, we'll focus on revenue growth to form a quick view of its business development. 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 year CPT Technology (Group)Ltd saw its revenue shrink by 50%. So we would not have expected the share price to rise 156%. This is a good example of how buyers can push up prices even before the fundamental metrics show much growth. It's quite likely the revenue fall was already priced in, anyway.

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

Take a more thorough look at CPT Technology (Group)Ltd's financial health with this free report on its balance sheet.

A Different Perspective

It's good to see that CPT Technology (Group)Ltd has rewarded shareholders with a total shareholder return of 156% in the last twelve months. That's better than the annualised return of 16% over half a decade, implying that the company is doing better recently. Someone with an optimistic perspective could view the recent improvement in TSR as indicating that the business itself is getting better with time. It's always interesting to track share price performance over the longer term. But to understand CPT Technology (Group)Ltd better, we need to consider many other factors. For example, we've discovered 1 warning sign for CPT Technology (Group)Ltd that you should be aware of before investing here.

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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.
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.