Sichuan Huati Lighting TechnologyLtd (SHSE:603679 investor five-year losses grow to 49% as the stock sheds CN¥318m this past week

It is doubtless a positive to see that the Sichuan Huati Lighting Technology Co.,Ltd. (SHSE:603679) share price has gained some 33% in the last three months. But if you look at the last five years the returns have not been good. In fact, the share price is down 50%, which falls well short of the return you could get by buying an index fund.

After losing 12% this past week, it's worth investigating the company's fundamentals to see what we can infer from past performance.

View our latest analysis for Sichuan Huati Lighting TechnologyLtd

Sichuan Huati Lighting TechnologyLtd 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. Some companies are willing to postpone profitability to grow revenue faster, but in that case one would hope for good top-line growth to make up for the lack of earnings.

In the last five years Sichuan Huati Lighting TechnologyLtd saw its revenue shrink by 9.3% per year. That's definitely a weaker result than most pre-profit companies report. It seems pretty reasonable to us that the share price dipped 8% per year in that time. This loss means the stock shareholders are probably pretty annoyed. Risk averse investors probably wouldn't like this one much.

The image below shows how earnings and revenue have tracked over time (if you click on the image you can see greater detail).

Balance sheet strength is crucial. It might be well worthwhile taking a look at our free report on how its financial position has changed over time.

A Different Perspective

Sichuan Huati Lighting TechnologyLtd provided a TSR of 4.0% over the last twelve months. But that return falls short of the market. But at least that's still a gain! Over five years the TSR has been a reduction of 8% per year, over five years. So this might be a sign the business has turned its fortunes around. 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 instance, we've identified 2 warning signs for Sichuan Huati Lighting TechnologyLtd that you should be aware of.

Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of companies we expect will 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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