Strong week for Henan Yicheng New Energy (SZSE:300080) shareholders doesn't alleviate pain of five-year loss

Ideally, your overall portfolio should beat the market average. But in any portfolio, there will be mixed results between individual stocks. At this point some shareholders may be questioning their investment in Henan Yicheng New Energy Co., Ltd. (SZSE:300080), since the last five years saw the share price fall 25%. The falls have accelerated recently, with the share price down 22% in the last three months.

The recent uptick of 8.4% could be a positive sign of things to come, so let's take a look at historical fundamentals.

See our latest analysis for Henan Yicheng New Energy

Given that Henan Yicheng New Energy didn't make a profit in the last twelve months, we'll focus on revenue growth to form a quick view of its business development. Generally speaking, companies without profits are expected to grow revenue every year, and at a good clip. 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, Henan Yicheng New Energy saw its revenue increase by 14% per year. That's a pretty good rate for a long time period. We doubt many shareholders are ok with the fact the share price has fallen 5% each year for half a decade. Those who bought back then clearly believed in stronger growth - and maybe even profits. There is always a big risk of losing money yourself when you buy shares in a company that loses money.

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

Take a more thorough look at Henan Yicheng New Energy's financial health with this free report on its balance sheet.

A Different Perspective

Henan Yicheng New Energy shareholders gained a total return of 1.2% during the year. But that was short of the market average. On the bright side, that's still a gain, and it is certainly better than the yearly loss of about 5% endured over half a decade. So this might be a sign the business has turned its fortunes around. 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. Consider risks, for instance. Every company has them, and we've spotted 1 warning sign for Henan Yicheng New Energy you should know about.

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.