Chahua Modern Housewares' (SHSE:603615) growing losses don't faze investors as the stock swells 18% this past week

Passive investing in index funds can generate returns that roughly match the overall market. But investors can boost returns by picking market-beating companies to own shares in. For example, the Chahua Modern Housewares Co., Ltd. (SHSE:603615) share price is up 57% in the last 1 year, clearly besting the market decline of around 7.9% (not including dividends). If it can keep that out-performance up over the long term, investors will do very well! It is also impressive that the stock is up 53% over three years, adding to the sense that it is a real winner.

Since it's been a strong week for Chahua Modern Housewares shareholders, let's have a look at trend of the longer term fundamentals.

Check out our latest analysis for Chahua Modern Housewares

Chahua Modern Housewares 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. Generally speaking, companies without profits are expected to grow revenue every year, and at a good clip. That's because fast revenue growth can be easily extrapolated to forecast profits, often of considerable size.

Chahua Modern Housewares actually shrunk its revenue over the last year, with a reduction of 12%. Despite the lack of revenue growth, the stock has returned a solid 57% the last twelve months. To us that means that there isn't a lot of correlation between the past revenue performance and the share price, but a closer look at analyst forecasts and the bottom line may well explain a lot.

The graphic below depicts how earnings and revenue have changed over time (unveil the exact values by clicking on the image).

This free interactive report on Chahua Modern Housewares' balance sheet strength is a great place to start, if you want to investigate the stock further.

A Different Perspective

We're pleased to report that Chahua Modern Housewares shareholders have received a total shareholder return of 58% over one year. That's better than the annualised return of 11% over half a decade, implying that the company is doing better recently. Given the share price momentum remains strong, it might be worth taking a closer look at the stock, lest you miss an opportunity. It's always interesting to track share price performance over the longer term. But to understand Chahua Modern Housewares better, we need to consider many other factors. Even so, be aware that Chahua Modern Housewares is showing 2 warning signs in our investment analysis , and 1 of those can't be ignored...

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.