Shareholders in Aofu Environmental TechnologyLtd (SHSE:688021) have lost 79%, as stock drops 13% this past week

It is a pleasure to report that the Aofu Environmental Technology Co.,Ltd. (SHSE:688021) is up 38% in the last quarter. But that is meagre solace in the face of the shocking decline over three years. To wit, the share price sky-dived 79% in that time. So it's about time shareholders saw some gains. The thing to think about is whether the business has really turned around.

After losing 13% 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 Aofu Environmental TechnologyLtd

While the efficient markets hypothesis continues to be taught by some, it has been proven that markets are over-reactive dynamic systems, and investors are not always rational. By comparing earnings per share (EPS) and share price changes over time, we can get a feel for how investor attitudes to a company have morphed over time.

Aofu Environmental TechnologyLtd saw its share price decline over the three years in which its EPS also dropped, falling to a loss. Due to the loss, it's not easy to use EPS as a reliable guide to the business. But it's safe to say we'd generally expect the share price to be lower as a result!

The graphic below depicts how EPS has changed over time (unveil the exact values by clicking on the image).

Dive deeper into Aofu Environmental TechnologyLtd's key metrics by checking this interactive graph of Aofu Environmental TechnologyLtd's earnings, revenue and cash flow.

A Different Perspective

Investors in Aofu Environmental TechnologyLtd had a tough year, with a total loss of 46%, against a market gain of about 14%. Even the share prices of good stocks drop sometimes, but we want to see improvements in the fundamental metrics of a business, before getting too interested. Unfortunately, last year's performance may indicate unresolved challenges, given that it was worse than the annualised loss of 11% 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. You might want to assess this data-rich visualization of its earnings, revenue and cash flow.

Of course Aofu Environmental TechnologyLtd 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.