This week we saw the Shanxi Yongdong Chemistry Industry Co., Ltd. (SZSE:002753) share price climb by 20%. But if you look at the last five years the returns have not been good. After all, the share price is down 26% in that time, significantly under-performing the market.

While the stock has risen 20% in the past week but long term shareholders are still in the red, let's see what the fundamentals can tell us.

View our latest analysis for Shanxi Yongdong Chemistry Industry

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.

In the last half decade Shanxi Yongdong Chemistry Industry saw its share price fall as its EPS declined below zero. At present it's hard to make valid comparisons between EPS and the share price. But we would generally expect a lower price, given the situation.

The graphic below depicts how EPS has changed over time (unveil the exact values by clicking on the image).

Dive deeper into Shanxi Yongdong Chemistry Industry's key metrics by checking this interactive graph of Shanxi Yongdong Chemistry Industry's earnings, revenue and cash flow.

What About Dividends?

It is important to consider the total shareholder return, as well as the share price return, for any given stock. Whereas the share price return only reflects the change in the share price, the TSR includes the value of dividends (assuming they were reinvested) and the benefit of any discounted capital raising or spin-off. It's fair to say that the TSR gives a more complete picture for stocks that pay a dividend. We note that for Shanxi Yongdong Chemistry Industry the TSR over the last 5 years was -21%, which is better than the share price return mentioned above. This is largely a result of its dividend payments!

A Different Perspective

Shanxi Yongdong Chemistry Industry shareholders are down 2.8% for the year (even including dividends), but the market itself is up 0.7%. Even the share prices of good stocks drop sometimes, but we want to see improvements in the fundamental metrics of a business, before getting too interested. Unfortunately, longer term shareholders are suffering worse, given the loss of 4% doled out over the last five years. We'd need to see some sustained improvements in the key metrics before we could muster much enthusiasm. 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. For example, we've discovered 1 warning sign for Shanxi Yongdong Chemistry Industry that you should be aware of before investing here.

Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of companies we expect will 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.