Aecc Aero Science and TechnologyLtd (SHSE:600391) lifts 7.7% this week, taking five-year gains to 39%

When we invest, we're generally looking for stocks that outperform the market average. And while active stock picking involves risks (and requires diversification) it can also provide excess returns. To wit, the Aecc Aero Science and TechnologyLtd share price has climbed 39% in five years, easily topping the market return of 12% (ignoring dividends). On the other hand, the more recent gains haven't been so impressive, with shareholders gaining just 6.2%.

The past week has proven to be lucrative for Aecc Aero Science and TechnologyLtd investors, so let's see if fundamentals drove the company's five-year performance.

View our latest analysis for Aecc Aero Science and TechnologyLtd

To quote Buffett, 'Ships will sail around the world but the Flat Earth Society will flourish. There will continue to be wide discrepancies between price and value in the marketplace...' One imperfect but simple way to consider how the market perception of a company has shifted is to compare the change in the earnings per share (EPS) with the share price movement.

During the last half decade, Aecc Aero Science and TechnologyLtd became profitable. That's generally thought to be a genuine positive, so investors may expect to see an increasing share price.

The image below shows how EPS has tracked over time (if you click on the image you can see greater detail).

We know that Aecc Aero Science and TechnologyLtd has improved its bottom line over the last three years, but what does the future have in store? If you are thinking of buying or selling Aecc Aero Science and TechnologyLtd stock, you should check out this FREE detailed report on its balance sheet.

A Different Perspective

Aecc Aero Science and TechnologyLtd provided a TSR of 6.2% over the last twelve months. But that return falls short of the market. It's probably a good sign that the company has an even better long term track record, having provided shareholders with an annual TSR of 7% over five years. It may well be that this is a business worth popping on the watching, given the continuing positive reception, over time, from the market. It's always interesting to track share price performance over the longer term. But to understand Aecc Aero Science and TechnologyLtd better, we need to consider many other factors. For example, we've discovered 2 warning signs for Aecc Aero Science and TechnologyLtd (1 is a bit concerning!) that you should be aware of before investing here.

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.

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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.