Optimism around Jianshe Industry Group (Yunnan) (SZSE:002265) delivering new earnings growth may be shrinking as stock declines 4.0% this past week

The simplest way to benefit from a rising market is to buy an index fund. While individual stocks can be big winners, plenty more fail to generate satisfactory returns. Unfortunately the Jianshe Industry Group (Yunnan) Co., Ltd. (SZSE:002265) share price slid 34% over twelve months. That's disappointing when you consider the market declined 14%. On the bright side, the stock is actually up 31% in the last three years. The falls have accelerated recently, with the share price down 15% in the last three months.

If the past week is anything to go by, investor sentiment for Jianshe Industry Group (Yunnan) isn't positive, so let's see if there's a mismatch between fundamentals and the share price.

See our latest analysis for Jianshe Industry Group (Yunnan)

There is no denying that markets are sometimes efficient, but prices do not always reflect underlying business performance. One way to examine how market sentiment has changed over time is to look at the interaction between a company's share price and its earnings per share (EPS).

Unfortunately Jianshe Industry Group (Yunnan) reported an EPS drop of 36% for the last year. We note that the 34% share price drop is very close to the EPS drop. Therefore one could posit that the market has not become more concerned about the company, despite the lower EPS. Instead, the change in the share price seems to reduction in earnings per share, alone.

You can see below how EPS has changed over time (discover the exact values by clicking on the image).

Dive deeper into Jianshe Industry Group (Yunnan)'s key metrics by checking this interactive graph of Jianshe Industry Group (Yunnan)'s earnings, revenue and cash flow.

A Different Perspective

We regret to report that Jianshe Industry Group (Yunnan) shareholders are down 34% for the year. Unfortunately, that's worse than the broader market decline of 14%. 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 3% 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. Before forming an opinion on Jianshe Industry Group (Yunnan) you might want to consider these 3 valuation metrics.

Of course Jianshe Industry Group (Yunnan) 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