Taking the occasional loss comes part and parcel with investing on the stock market. And unfortunately for Ningbo Xusheng Group Co., Ltd. (SHSE:603305) shareholders, the stock is a lot lower today than it was a year ago. In that relatively short period, the share price has plunged 51%. At least the damage isn't so bad if you look at the last three years, since the stock is down 11% in that time. Shareholders have had an even rougher run lately, with the share price down 36% in the last 90 days. Of course, this share price action may well have been influenced by the 14% decline in the broader market, throughout the period.

While the stock has risen 3.2% in the past week but long term shareholders are still in the red, let's see what the fundamentals can tell us.

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 unfortunate twelve months during which the Ningbo Xusheng Group share price fell, it actually saw its earnings per share (EPS) improve by 31%. It's quite possible that growth expectations may have been unreasonable in the past.

It's fair to say that the share price does not seem to be reflecting the EPS growth. So it's well worth checking out some other metrics, too.

Given the yield is quite low, at 0.6%, we doubt the dividend can shed much light on the share price. Ningbo Xusheng Group managed to grow revenue over the last year, which is usually a real positive. Since the fundamental metrics don't readily explain the share price drop, there might be an opportunity if the market has overreacted.

The graphic below depicts how earnings and revenue have changed over time (unveil the exact values by clicking on the image).

Ningbo Xusheng Group is well known by investors, and plenty of clever analysts have tried to predict the future profit levels. So it makes a lot of sense to check out what analysts think Ningbo Xusheng Group will earn in the future (free analyst consensus estimates)

A Different Perspective

While the broader market lost about 23% in the twelve months, Ningbo Xusheng Group shareholders did even worse, losing 51% (even including dividends). Having said that, it's inevitable that some stocks will be oversold in a falling market. The key is to keep your eyes on the fundamental developments. Longer term investors wouldn't be so upset, since they would have made 0.9%, each year, over five years. It could be that the recent sell-off is an opportunity, so it may be worth checking the fundamental data for signs of a long term growth trend. It's always interesting to track share price performance over the longer term. But to understand Ningbo Xusheng Group better, we need to consider many other factors. Case in point: We've spotted 1 warning sign for Ningbo Xusheng Group you should be aware of.

But note: Ningbo Xusheng Group may not be the best stock to buy. So take a peek at this free list of interesting companies with past earnings growth (and further growth forecast).

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.