Zhengping Road & Bridge ConstructionLtd (SHSE:603843 shareholders incur further losses as stock declines 12% this week, taking five-year losses to 44%

While it may not be enough for some shareholders, we think it is good to see the Zhengping Road & Bridge Construction Co.,Ltd. (SHSE:603843) share price up 20% in a single quarter. But if you look at the last five years the returns have not been good. You would have done a lot better buying an index fund, since the stock has dropped 45% in that half decade.

Since Zhengping Road & Bridge ConstructionLtd has shed CN¥266m from its value in the past 7 days, let's see if the longer term decline has been driven by the business' economics.

See our latest analysis for Zhengping Road & Bridge ConstructionLtd

Zhengping Road & Bridge ConstructionLtd 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 Zhengping Road & Bridge ConstructionLtd saw its revenue shrink by 10% per year. That puts it in an unattractive cohort, to put it mildly. It seems pretty reasonable to us that the share price dipped 8% per year in that time. We doubt many shareholders are delighted with this share price performance. Risk averse investors probably wouldn't like this one much.

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 Zhengping Road & Bridge ConstructionLtd's financial health with this free report on its balance sheet.

A Different Perspective

While the broader market lost about 10% in the twelve months, Zhengping Road & Bridge ConstructionLtd shareholders did even worse, losing 25%. 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. Regrettably, last year's performance caps off a bad run, with the shareholders facing a total loss of 8% per year over five years. 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. 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. To that end, you should be aware of the 3 warning signs we've spotted with Zhengping Road & Bridge ConstructionLtd .

But note: Zhengping Road & Bridge ConstructionLtd may not be the best stock to buy. So take a peek at this free list of interesting companies with past earnings growth (and further growth forecast).

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.