It's easy to feel disappointed if you buy a stock that goes down. But in the short term the market is a voting machine, and the share price movements may not reflect the underlying business performance. The Shenzhen Zhongjin Lingnan Nonfemet Co. Ltd. (SZSE:000060) is down 10% over a year, but the total shareholder return is -8.4% once you include the dividend. That's better than the market which declined 15% over the last year. At least the damage isn't so bad if you look at the last three years, since the stock is down 1.6% in that time. Even worse, it's down 10.0% in about a month, which isn't fun at all. However, we note the price may have been impacted by the broader market, which is down 5.4% in the same time period.

Given the past week has been tough on shareholders, let's investigate the fundamentals and see what we can learn.

While the efficient markets hypothesis continues to be taught by some, it has been proven that markets are over-reactive dynamic systems, and investors are not always rational. 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.

Unfortunately Shenzhen Zhongjin Lingnan Nonfemet reported an EPS drop of 52% for the last year. The share price fall of 10% isn't as bad as the reduction in earnings per share. So the market may not be too worried about the EPS figure, at the moment -- or it may have expected earnings to drop faster.

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

This free interactive report on Shenzhen Zhongjin Lingnan Nonfemet's earnings, revenue and cash flow is a great place to start, if you want to investigate the stock further.

A Different Perspective

While it's never nice to take a loss, Shenzhen Zhongjin Lingnan Nonfemet shareholders can take comfort that , including dividends,their trailing twelve month loss of 8.4% wasn't as bad as the market loss of around 15%. Unfortunately, last year's performance may indicate unresolved challenges, given that it's worse than the annualised loss of 0.5% over the last half decade. Whilst Baron Rothschild does tell the investor "buy when there's blood in the streets, even if the blood is your own", buyers would need to examine the data carefully to be comfortable that the business itself is sound. It's always interesting to track share price performance over the longer term. But to understand Shenzhen Zhongjin Lingnan Nonfemet better, we need to consider many other factors. Even so, be aware that Shenzhen Zhongjin Lingnan Nonfemet is showing 3 warning signs in our investment analysis , and 1 of those is potentially serious...

Of course Shenzhen Zhongjin Lingnan Nonfemet 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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com