While shareholders of Leshan Giantstar Farming&Husbandry (SHSE:603477) are in the black over 5 years, those who bought a week ago aren't so fortunate

Some Leshan Giantstar Farming&Husbandry Corporation Limited (SHSE:603477) shareholders are probably rather concerned to see the share price fall 51% over the last three months. But that scarcely detracts from the really solid long term returns generated by the company over five years. We think most investors would be happy with the 107% return, over that period. Generally speaking the long term returns will give you a better idea of business quality than short periods can. The more important question is whether the stock is too cheap or too expensive today.

Although Leshan Giantstar Farming&Husbandry has shed CN¥663m from its market cap this week, let's take a look at its longer term fundamental trends and see if they've driven returns.

Check out our latest analysis for Leshan Giantstar Farming&Husbandry

There is no denying that markets are sometimes efficient, but prices do not always reflect 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.

During five years of share price growth, Leshan Giantstar Farming&Husbandry actually saw its EPS drop 44% per year.

Essentially, it doesn't seem likely that investors are focused on EPS. Since the change in EPS doesn't seem to correlate with the change in share price, it's worth taking a look at other metrics.

In contrast revenue growth of 36% per year is probably viewed as evidence that Leshan Giantstar Farming&Husbandry is growing, a real positive. It's quite possible that management are prioritizing revenue growth over EPS growth at the moment.

You can see below how earnings and revenue have changed over time (discover the exact values by clicking on the image).

You can see how its balance sheet has strengthened (or weakened) over time in this free interactive graphic.

What About The Total Shareholder Return (TSR)?

We'd be remiss not to mention the difference between Leshan Giantstar Farming&Husbandry's total shareholder return (TSR) and its share price return. The TSR is a return calculation that accounts for the value of cash dividends (assuming that any dividend received was reinvested) and the calculated value of any discounted capital raisings and spin-offs. Dividends have been really beneficial for Leshan Giantstar Farming&Husbandry shareholders, and that cash payout contributed to why its TSR of 110%, over the last 5 years, is better than the share price return.

A Different Perspective

While the broader market lost about 19% in the twelve months, Leshan Giantstar Farming&Husbandry shareholders did even worse, losing 38%. 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. On the bright side, long term shareholders have made money, with a gain of 16% per year over half a decade. If the fundamental data continues to indicate long term sustainable growth, the current sell-off could be an opportunity worth considering. 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. Take risks, for example - Leshan Giantstar Farming&Husbandry has 1 warning sign we think you should be aware of.

But note: Leshan Giantstar Farming&Husbandry 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.