Shareholders have faith in loss-making Jiangsu Boamax Technologies GroupLtd (SZSE:002514) as stock climbs 12% in past week, taking three-year gain to 68%

By buying an index fund, you can roughly match the market return with ease. But many of us dare to dream of bigger returns, and build a portfolio ourselves. For example, the Jiangsu Boamax Technologies Group Co.,Ltd. (SZSE:002514) share price is up 68% in the last three years, clearly besting the market decline of around 19% (not including dividends).

On the back of a solid 7-day performance, let's check what role the company's fundamentals have played in driving long term shareholder returns.

Check out our latest analysis for Jiangsu Boamax Technologies GroupLtd

Jiangsu Boamax Technologies GroupLtd isn't currently profitable, so most analysts would look to revenue growth to get an idea of how fast the underlying business is growing. When a company doesn't make profits, we'd generally hope to see good revenue growth. As you can imagine, fast revenue growth, when maintained, often leads to fast profit growth.

In the last 3 years Jiangsu Boamax Technologies GroupLtd saw its revenue shrink by 14% per year. The revenue growth might be lacking but the share price has gained 19% each year in that time. If the company is cutting costs profitability could be on the horizon, but the revenue decline is a prima facie concern.

The company's revenue and earnings (over time) are depicted in the image below (click to see the exact numbers).

This free interactive report on Jiangsu Boamax Technologies GroupLtd's balance sheet strength is a great place to start, if you want to investigate the stock further.

A Different Perspective

Jiangsu Boamax Technologies GroupLtd shareholders are down 8.1% for the year, but the market itself is up 10%. However, keep in mind that even the best stocks will sometimes underperform the market over a twelve month period. On the bright side, long term shareholders have made money, with a gain of 7% per year over half a decade. It could be that the recent sell-off is an opportunity, so it may be worth checking the fundamental data for signs of a long term growth trend. While it is well worth considering the different impacts that market conditions can have on the share price, there are other factors that are even more important. Case in point: We've spotted 2 warning signs for Jiangsu Boamax Technologies GroupLtd you should be aware of, and 1 of them is a bit concerning.

If you would prefer to check out another company -- one with potentially superior financials -- then do not miss this free list of companies that have proven they can 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.