By buying an index fund, you can roughly match the market return with ease. But if you pick the right individual stocks, you could make more than that. For example, the Tatwah Smartech Co.,Ltd. (SZSE:002512) share price is up 75% in the last three years, clearly besting the market decline of around 18% (not including dividends). On the other hand, the returns haven't been quite so good recently, with shareholders up just 5.6%.

The past week has proven to be lucrative for Tatwah SmartechLtd investors, so let's see if fundamentals drove the company's three-year performance.

Given that Tatwah SmartechLtd 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 desire strong revenue growth. That's because fast revenue growth can be easily extrapolated to forecast profits, often of considerable size.

Tatwah SmartechLtd actually saw its revenue drop by 3.6% per year over three years. The revenue growth might be lacking but the share price has gained 21% each year in that time. If the company is cutting costs profitability could be on the horizon, but the revenue decline is a prima facie concern.

You can see how earnings and revenue have changed over time in the image below (click on the chart to see the exact values).

Take a more thorough look at Tatwah SmartechLtd's financial health with this free report on its balance sheet.

A Different Perspective

Tatwah SmartechLtd's TSR for the year was broadly in line with the market average, at 5.6%. The silver lining is that the share price is up in the short term, which flies in the face of the annualised loss of 0.6% over the last five years. While 'turnarounds seldom turn' there are green shoots for Tatwah SmartechLtd. I find it very interesting to look at share price over the long term as a proxy for business performance. But to truly gain insight, we need to consider other information, too. For example, we've discovered 2 warning signs for Tatwah SmartechLtd that you should be aware of before investing here.

If you would prefer to check out another company -- one with potentially superior financials -- then do not miss this free list of companies that have proven they can 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.