Zhongrun Resources Investment Corporation (SZSE:000506) shareholders will doubtless be very grateful to see the share price up 81% in the last quarter. But in truth the last year hasn't been good for the share price. The cold reality is that the stock has dropped 41% in one year, under-performing the market.

While the stock has risen 27% in the past week but long term shareholders are still in the red, let's see what the fundamentals can tell us.

Because Zhongrun Resources Investment 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. Generally speaking, companies without profits are expected to grow revenue every year, and at a good clip. 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.

Zhongrun Resources Investment's revenue didn't grow at all in the last year. In fact, it fell 23%. That looks pretty grim, at a glance. Shareholders have seen the share price drop 41% in that time. That seems pretty reasonable given the lack of both profits and revenue growth. We think most holders must believe revenue growth will improve, or else costs will decline.

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 Zhongrun Resources Investment's financial health with this free report on its balance sheet.

A Different Perspective

While the broader market gained around 6.5% in the last year, Zhongrun Resources Investment shareholders lost 41%. However, keep in mind that even the best stocks will sometimes underperform the market over a twelve month period. Unfortunately, last year's performance may indicate unresolved challenges, given that it was worse than the annualised loss of 0.6% over the last half decade. Generally speaking long term share price weakness can be a bad sign, though contrarian investors might want to research the stock in hope of a turnaround. You might want to assess this data-rich visualization of its earnings, revenue and cash flow.

Of course Zhongrun Resources Investment may not be the best stock to buy. So you may wish to see this free collection of growth stocks.

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.