No-one enjoys it when they lose money on a stock. But no-one can make money on every call, especially in a declining market. Over three years the Jinneng Holding Shanxi Electric Power Co.,LTD. (SZSE:000767) share price fell 20%. The silver lining to that cloud is that this return is superior to the average market decline of 26%.
Given the past week has been tough on shareholders, let's investigate the fundamentals and see what we can learn.
See our latest analysis for Jinneng Holding Shanxi Electric PowerLTD
Because Jinneng Holding Shanxi Electric PowerLTD 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. 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.
Over three years, Jinneng Holding Shanxi Electric PowerLTD grew revenue at 23% per year. That's well above most other pre-profit companies. It saw its share price decline by 6% per year over the last three. It's possible the weak market has impacted sentiment, because revenue is still growing. That means now could be exactly the right time to take a closer look at this business. Could the current price be an opportunity?
You can see how earnings and revenue have changed over time in the image below (click on the chart to see the exact values).
We're pleased to report that the CEO is remunerated more modestly than most CEOs at similarly capitalized companies. It's always worth keeping an eye on CEO pay, but a more important question is whether the company will grow earnings throughout the years. This free interactive report on Jinneng Holding Shanxi Electric PowerLTD's earnings, revenue and cash flow is a great place to start, if you want to investigate the stock further.
A Different Perspective
While it's certainly disappointing to see that Jinneng Holding Shanxi Electric PowerLTD shares lost 16% throughout the year, that wasn't as bad as the market loss of 18%. Of course, the long term returns are far more important and the good news is that over five years, the stock has returned 2% for each year. It could be that the business is just facing some short term problems, but shareholders should keep a close eye on the fundamentals. It's always interesting to track share price performance over the longer term. But to understand Jinneng Holding Shanxi Electric PowerLTD better, we need to consider many other factors. For instance, we've identified 1 warning sign for Jinneng Holding Shanxi Electric PowerLTD that you should be aware of.
If you would prefer to check out another company -- one with potentially superior financials -- then do not miss this free list of companies that have proven they can 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.