The one-year earnings decline is not helping Tianjin Saixiang TechnologyLtd's (SZSE:002337 share price, as stock falls another 12% in past week

The simplest way to benefit from a rising market is to buy an index fund. But if you buy individual stocks, you can do both better or worse than that. For example, the Tianjin Saixiang Technology Co.,Ltd (SZSE:002337) share price is down 31% in the last year. That falls noticeably short of the market decline of around 10%. Longer term investors have fared much better, since the share price is up 14% in three years. Shareholders have had an even rougher run lately, with the share price down 25% in the last 90 days.

Since Tianjin Saixiang TechnologyLtd has shed CN¥279m 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 Tianjin Saixiang TechnologyLtd

While markets are a powerful pricing mechanism, share prices reflect investor sentiment, not just underlying business performance. 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.

Unfortunately Tianjin Saixiang TechnologyLtd reported an EPS drop of 58% for the last year. The share price fall of 31% isn't as bad as the reduction in earnings per share. So despite the weak per-share profits, some investors are probably relieved the situation wasn't more difficult. With a P/E ratio of 52.09, it's fair to say the market sees an EPS rebound on the cards.

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

This free interactive report on Tianjin Saixiang TechnologyLtd's earnings, revenue and cash flow is a great place to start, if you want to investigate the stock further.

A Different Perspective

We regret to report that Tianjin Saixiang TechnologyLtd shareholders are down 30% for the year (even including dividends). Unfortunately, that's worse than the broader market decline of 10%. Having said that, it's inevitable that some stocks will be oversold in a falling market. The key is to keep your eyes on the fundamental developments. Regrettably, last year's performance caps off a bad run, with the shareholders facing a total loss of 2% per year over five years. We realise that Baron Rothschild has said investors should "buy when there is blood on the streets", but we caution that investors should first be sure they are buying a high quality business. It's always interesting to track share price performance over the longer term. But to understand Tianjin Saixiang TechnologyLtd better, we need to consider many other factors. Even so, be aware that Tianjin Saixiang TechnologyLtd is showing 3 warning signs in our investment analysis , and 1 of those is significant...

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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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.