Even after rising 8.8% this past week, China Reform Health Management and Services Group (SZSE:000503) shareholders are still down 57% over the past five years

China Reform Health Management and Services Group Co., Ltd. (SZSE:000503) shareholders should be happy to see the share price up 15% in the last month. But don't envy holders -- looking back over 5 years the returns have been really bad. In that time the share price has delivered a rude shock to holders, who find themselves down 57% after a long stretch. So is the recent increase sufficient to restore confidence in the stock? Not yet. But it could be that the fall was overdone.

Although the past week has been more reassuring for shareholders, they're still in the red over the last five years, so let's see if the underlying business has been responsible for the decline.

Check out our latest analysis for China Reform Health Management and Services Group

Because China Reform Health Management and Services Group made a loss in the last twelve months, we think the market is probably more focussed on revenue and revenue growth, at least for now. Shareholders of unprofitable companies usually desire strong revenue growth. Some companies are willing to postpone profitability to grow revenue faster, but in that case one would hope for good top-line growth to make up for the lack of earnings.

In the last half decade, China Reform Health Management and Services Group saw its revenue increase by 23% per year. That's well above most other pre-profit companies. In contrast, the share price is has averaged a loss of 9% per year - that's quite disappointing. It's safe to say investor expectations are more grounded now. If you think the company can keep up its revenue growth, you'd have to consider the possibility that there's an opportunity here.

You can see how earnings and revenue have changed over time in the image below (click on the chart to see the exact values).

This free interactive report on China Reform Health Management and Services Group's balance sheet strength is a great place to start, if you want to investigate the stock further.

A Different Perspective

We regret to report that China Reform Health Management and Services Group shareholders are down 28% for the year. Unfortunately, that's worse than the broader market decline of 17%. 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 9% per year over five years. 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. It's always interesting to track share price performance over the longer term. But to understand China Reform Health Management and Services Group better, we need to consider many other factors. Case in point: We've spotted 1 warning sign for China Reform Health Management and Services Group you should be aware of.

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.