Investing in stocks comes with the risk that the share price will fall. And unfortunately for Jiangxi Haiyuan Composites Technology Co.,Ltd. (SZSE:002529) shareholders, the stock is a lot lower today than it was a year ago. The share price is down a hefty 61% in that time. At least the damage isn't so bad if you look at the last three years, since the stock is down 29% in that time. Shareholders have had an even rougher run lately, with the share price down 34% in the last 90 days.

After losing 20% this past week, it's worth investigating the company's fundamentals to see what we can infer from past performance.

Because Jiangxi Haiyuan Composites TechnologyLtd 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. As you can imagine, fast revenue growth, when maintained, often leads to fast profit growth.

In just one year Jiangxi Haiyuan Composites TechnologyLtd saw its revenue fall by 13%. That looks pretty grim, at a glance. In the absence of profits, it's not unreasonable that the share price fell 61%. Having said that, if growth is coming in the future, the stock may have better days ahead. We have a natural aversion to companies that are losing money and shrinking revenue. But perhaps that is being too careful.

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

You can see how its balance sheet has strengthened (or weakened) over time in this free interactive graphic.

A Different Perspective

We regret to report that Jiangxi Haiyuan Composites TechnologyLtd shareholders are down 61% for the year. Unfortunately, that's worse than the broader market decline of 9.6%. 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. 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. It's always interesting to track share price performance over the longer term. But to understand Jiangxi Haiyuan Composites TechnologyLtd better, we need to consider many other factors. To that end, you should learn about the 2 warning signs we've spotted with Jiangxi Haiyuan Composites TechnologyLtd (including 1 which is significant) .

If you like to buy stocks alongside management, then you might just love this free list of companies. (Hint: many of them are unnoticed AND have attractive valuation).

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.