If you love investing in stocks you're bound to buy some losers. But the long term shareholders of LifeTech Scientific Corporation (HKG:1302) have had an unfortunate run in the last three years. So they might be feeling emotional about the 59% share price collapse, in that time. And more recent buyers are having a tough time too, with a drop of 36% in the last year. On top of that, the share price is down 6.0% in the last week. However, this move may have been influenced by the broader market, which fell 3.0% in that time.

If the past week is anything to go by, investor sentiment for LifeTech Scientific 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 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 the three years that the share price fell, LifeTech Scientific's earnings per share (EPS) dropped by 10% each year. This reduction in EPS is slower than the 26% annual reduction in the share price. So it's likely that the EPS decline has disappointed the market, leaving investors hesitant to buy.

The image below shows how EPS has tracked over time (if you click on the image you can see greater detail).

It might be well worthwhile taking a look at our free report on LifeTech Scientific's earnings, revenue and cash flow.

A Different Perspective

While the broader market gained around 16% in the last year, LifeTech Scientific shareholders lost 36%. However, keep in mind that even the best stocks will sometimes underperform the market over a twelve month period. Longer term investors wouldn't be so upset, since they would have made 4%, each year, over five years. 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 LifeTech Scientific better, we need to consider many other factors. To that end, you should be aware of the 2 warning signs we've spotted with LifeTech Scientific .

For those who like to find winning investments this free list of undervalued companies with recent insider purchasing, could be just the ticket.

Please note, the market returns quoted in this article reflect the market weighted average returns of stocks that currently trade on Hong Kong 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.