By buying an index fund, you can roughly match the market return with ease. But if you choose individual stocks with prowess, you can make superior returns. Just take a look at Allwin Telecommunication Co., Ltd. (SZSE:002231), which is up 31%, over three years, soundly beating the market decline of 19% (not including dividends). However, more recent returns haven't been as impressive as that, with the stock returning just 11% in the last year.

The past week has proven to be lucrative for Allwin Telecommunication investors, so let's see if fundamentals drove the company's three-year performance.

Allwin Telecommunication isn't currently profitable, so most analysts would look to revenue growth to get an idea of how fast the underlying business is growing. Generally speaking, companies without profits are expected to grow revenue every year, and at a good clip. As you can imagine, fast revenue growth, when maintained, often leads to fast profit growth.

In the last 3 years Allwin Telecommunication saw its revenue shrink by 14% per year. The revenue growth might be lacking but the share price has gained 9% each year in that time. If the company is cutting costs profitability could be on the horizon, but the revenue decline is a prima facie concern.

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

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. Dive deeper into the earnings by checking this interactive graph of Allwin Telecommunication's earnings, revenue and cash flow.

A Different Perspective

Allwin Telecommunication provided a TSR of 11% over the year. That's fairly close to the broader market return. The silver lining is that the share price is up in the short term, which flies in the face of the annualised loss of 0.2% over the last five years. While 'turnarounds seldom turn' there are green shoots for Allwin Telecommunication. 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. Even so, be aware that Allwin Telecommunication is showing 3 warning signs in our investment analysis , and 2 of those are significant...

But note: Allwin Telecommunication may not be the best stock to buy. So take a peek at this free list of interesting companies with past earnings growth (and further growth forecast).

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.