Optimism around Anshan Hifichem (SZSE:300758) delivering new earnings growth may be shrinking as stock declines 9.4% this past week

Anshan Hifichem Co., Ltd. (SZSE:300758) shareholders will doubtless be very grateful to see the share price up 31% in the last quarter. If you look at the last three years, the stock price is down. But that's not so bad when you consider its market is down 27%.

After losing 9.4% this past week, it's worth investigating the company's fundamentals to see what we can infer from past performance.

Check out our latest analysis for Anshan Hifichem

While the efficient markets hypothesis continues to be taught by some, it has been proven that markets are over-reactive dynamic systems, and investors are not always rational. 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.

Anshan Hifichem became profitable within the last five years. We would usually expect to see the share price rise as a result. So given the share price is down it's worth checking some other metrics too.

The company has kept revenue pretty healthy over the last three years, so we doubt that explains the falling share price. We're not entirely sure why the share price is dropped, but it does seem likely investors have become less optimistic about the business.

The company's revenue and earnings (over time) are depicted in the image below (click to see the exact numbers).

We know that Anshan Hifichem has improved its bottom line lately, but what does the future have in store? This free report showing analyst forecasts should help you form a view on Anshan Hifichem

What About The Total Shareholder Return (TSR)?

We'd be remiss not to mention the difference between Anshan Hifichem's total shareholder return (TSR) and its share price return. Arguably the TSR is a more complete return calculation because it accounts for the value of dividends (as if they were reinvested), along with the hypothetical value of any discounted capital that have been offered to shareholders. Dividends have been really beneficial for Anshan Hifichem shareholders, and that cash payout explains why its total shareholder loss of 22%, over the last 3 years, isn't as bad as the share price return.

A Different Perspective

We're pleased to report that Anshan Hifichem shareholders have received a total shareholder return of 10% over one year. That's better than the annualised return of 0.3% over half a decade, implying that the company is doing better recently. Someone with an optimistic perspective could view the recent improvement in TSR as indicating that the business itself is getting better with time. While it is well worth considering the different impacts that market conditions can have on the share price, there are other factors that are even more important. To that end, you should be aware of the 1 warning sign we've spotted with Anshan Hifichem .

Of course Anshan Hifichem 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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com