The truth is that if you invest for long enough, you're going to end up with some losing stocks. Long term Jiangsu Xinri E-Vehicle Co., Ltd. (SHSE:603787) shareholders know that all too well, since the share price is down considerably over three years. Sadly for them, the share price is down 63% in that time. The more recent news is of little comfort, with the share price down 37% in a year. On top of that, the share price is down 13% in the last week.
If the past week is anything to go by, investor sentiment for Jiangsu Xinri E-Vehicle 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. By comparing earnings per share (EPS) and share price changes over time, we can get a feel for how investor attitudes to a company have morphed over time.
During the three years that the share price fell, Jiangsu Xinri E-Vehicle's earnings per share (EPS) dropped by 24% each year. This fall in EPS isn't far from the rate of share price decline, which was 28% per year. So it seems like sentiment towards the stock hasn't changed all that much over time. Rather, the share price has approximately tracked EPS growth.
The company's earnings per share (over time) is depicted in the image below (click to see the exact numbers).
It might be well worthwhile taking a look at our free report on Jiangsu Xinri E-Vehicle's earnings, revenue and cash flow.
A Different Perspective
While the broader market lost about 12% in the twelve months, Jiangsu Xinri E-Vehicle shareholders did even worse, losing 36% (even including dividends). However, it could simply be that the share price has been impacted by broader market jitters. It might be worth keeping an eye on the fundamentals, in case there's a good opportunity. Unfortunately, last year's performance may indicate unresolved challenges, given that it was worse than the annualised loss of 5% over the last half decade. We realise that Baron Rothschild has said investors should "buy when there is blood on the streets", but we caution that investors should first be sure they are buying a high quality business. It's always interesting to track share price performance over the longer term. But to understand Jiangsu Xinri E-Vehicle better, we need to consider many other factors. For example, we've discovered 4 warning signs for Jiangsu Xinri E-Vehicle that you should be aware of before investing here.
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 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.