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Further Weakness as OFILM Group (SZSE:002456) Drops 16% This Week, Taking Five-year Losses to 46%

Simply Wall St ·  Feb 6 00:41

Ideally, your overall portfolio should beat the market average. But in any portfolio, there will be mixed results between individual stocks. At this point some shareholders may be questioning their investment in OFILM Group Co., Ltd. (SZSE:002456), since the last five years saw the share price fall 46%. The share price has dropped 48% in three months. Of course, this share price action may well have been influenced by the 21% decline in the broader market, throughout the period.

After losing 16% this past week, it's worth investigating the company's fundamentals to see what we can infer from past performance.

Given that OFILM Group didn't make a profit in the last twelve months, we'll focus on revenue growth to form a quick view of its business development. Shareholders of unprofitable companies usually expect strong revenue growth. As you can imagine, fast revenue growth, when maintained, often leads to fast profit growth.

Over half a decade OFILM Group reduced its trailing twelve month revenue by 25% for each year. That's definitely a weaker result than most pre-profit companies report. On the face of it we'd posit the share price fall of 8% compound, over five years is well justified by the fundamental deterioration. This loss means the stock shareholders are probably pretty annoyed. Risk averse investors probably wouldn't like this one much.

The company's revenue and earnings (over time) are depicted in the image below (click to see the exact numbers).

earnings-and-revenue-growth
SZSE:002456 Earnings and Revenue Growth February 6th 2024

If you are thinking of buying or selling OFILM Group stock, you should check out this FREE detailed report on its balance sheet.

A Different Perspective

It's good to see that OFILM Group has rewarded shareholders with a total shareholder return of 17% in the last twelve months. That certainly beats the loss of about 8% per year over the last half decade. We generally put more weight on the long term performance over the short term, but the recent improvement could hint at a (positive) inflection point within the business. You could get a better understanding of OFILM Group's growth by checking out this more detailed historical graph of earnings, revenue and cash flow.

Of course OFILM Group 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.

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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.

Disclaimer: This content is for informational and educational purposes only and does not constitute a recommendation or endorsement of any specific investment or investment strategy. Read more
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