Ningbo ShanshanLtd (SHSE:600884 shareholders incur further losses as stock declines 11% this week, taking three-year losses to 76%

While not a mind-blowing move, it is good to see that the Ningbo Shanshan Co.,Ltd. (SHSE:600884) share price has gained 26% in the last three months. But the last three years have seen a terrible decline. Indeed, the share price is down a whopping 77% in the last three years. So it sure is nice to see a bit of an improvement. Of course the real question is whether the business can sustain a turnaround.

If the past week is anything to go by, investor sentiment for Ningbo ShanshanLtd isn't positive, so let's see if there's a mismatch between fundamentals and the share price.

Check out our latest analysis for Ningbo ShanshanLtd

There is no denying that markets are sometimes efficient, but prices do not always reflect underlying business performance. One way to examine how market sentiment has changed over time is to look at the interaction between a company's share price and its earnings per share (EPS).

Ningbo ShanshanLtd saw its share price decline over the three years in which its EPS also dropped, falling to a loss. Due to the loss, it's not easy to use EPS as a reliable guide to the business. But it's safe to say we'd generally expect the share price to be lower as a result!

You can see how EPS has changed over time in the image below (click on the chart to see the exact values).

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

A Different Perspective

Ningbo ShanshanLtd shareholders are down 34% for the year (even including dividends), but the market itself is up 4.2%. Even the share prices of good stocks drop sometimes, but we want to see improvements in the fundamental metrics of a business, before getting too interested. Longer term investors wouldn't be so upset, since they would have made 3%, each year, over five years. If the fundamental data continues to indicate long term sustainable growth, the current sell-off could be an opportunity worth considering. It's always interesting to track share price performance over the longer term. But to understand Ningbo ShanshanLtd better, we need to consider many other factors. Even so, be aware that Ningbo ShanshanLtd is showing 2 warning signs in our investment analysis , you should know about...

Of course Ningbo ShanshanLtd may not be the best stock to buy. So you may wish to see this free collection of growth stocks.

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.