It is doubtless a positive to see that the Improve Medical Instruments Co., Ltd. (SZSE:300030) share price has gained some 91% in the last three months. But that cannot eclipse the less-than-impressive returns over the last three years. In fact, the share price is down 29% in the last three years, falling well short of the market return.

After losing 16% this past week, it's worth investigating the company's fundamentals to see what we can infer from past performance.

Because Improve Medical Instruments made a loss in the last twelve months, we think the market is probably more focussed on revenue and revenue growth, at least for now. Shareholders of unprofitable companies usually desire strong revenue growth. Some companies are willing to postpone profitability to grow revenue faster, but in that case one would hope for good top-line growth to make up for the lack of earnings.

Over the last three years, Improve Medical Instruments' revenue dropped 13% per year. That is not a good result. The stock has disappointed holders over the last three years, falling 9%, annualized. That makes sense given the lack of either profits or revenue growth. Of course, sentiment could become too negative, and the company may actually be making progress to profitability.

You can see below how earnings and revenue have changed over time (discover the exact values by clicking on the image).

Take a more thorough look at Improve Medical Instruments' financial health with this free report on its balance sheet.

A Different Perspective

We regret to report that Improve Medical Instruments shareholders are down 13% for the year. Unfortunately, that's worse than the broader market decline of 0.6%. Having said that, it's inevitable that some stocks will be oversold in a falling market. The key is to keep your eyes on the fundamental developments. On the bright side, long term shareholders have made money, with a gain of 1.9% per year over half a decade. It could be that the recent sell-off is an opportunity, so it may be worth checking the fundamental data for signs of a long term growth trend. It's always interesting to track share price performance over the longer term. But to understand Improve Medical Instruments better, we need to consider many other factors. Consider risks, for instance. Every company has them, and we've spotted 2 warning signs for Improve Medical Instruments you should know about.

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.

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.