It is a pleasure to report that the KraussMaffei Company Limited (SHSE:600579) is up 52% in the last quarter. But that doesn't change the fact that the returns over the last three years haven't been great. To be specific, the share price is a full 17% lower, while the market is down , with a return of (-15%)..

The recent uptick of 11% could be a positive sign of things to come, so let's take a look at historical fundamentals.

KraussMaffei wasn't profitable in the last twelve months, it is unlikely we'll see a strong correlation between its share price and its earnings per share (EPS). Arguably revenue is our next best option. Shareholders of unprofitable companies usually desire strong revenue growth. That's because it's hard to be confident a company will be sustainable if revenue growth is negligible, and it never makes a profit.

Over three years, KraussMaffei grew revenue at 4.4% per year. That's not a very high growth rate considering it doesn't make profits. Indeed, the stock dropped 5% over the last three years. If revenue growth accelerates, we might see the share price bounce. But the real upside for shareholders will be if the company can start generating profits.

You can see below how earnings and revenue have changed over time (discover the exact values by clicking on the image).

This free interactive report on KraussMaffei's balance sheet strength is a great place to start, if you want to investigate the stock further.

A Different Perspective

KraussMaffei provided a TSR of 1.6% over the last twelve months. But that return falls short of the market. On the bright side, the longer term returns (running at about 3% a year, over half a decade) look better. It may well be that this is a business worth popping on the watching, given the continuing positive reception, over time, from the market. 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. Case in point: We've spotted 1 warning sign for KraussMaffei you should be aware of.

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.