Nanjing King-Friend Biochemical PharmaceuticalLtd (SHSE:603707 shareholders incur further losses as stock declines 8.0% this week, taking three-year losses to 56%

Investing in stocks inevitably means buying into some companies that perform poorly. But the last three years have been particularly tough on longer term Nanjing King-Friend Biochemical Pharmaceutical Co.,Ltd. (SHSE:603707) shareholders. So they might be feeling emotional about the 57% share price collapse, in that time. Shareholders have had an even rougher run lately, with the share price down 16% in the last 90 days.

Given the past week has been tough on shareholders, let's investigate the fundamentals and see what we can learn.

View our latest analysis for Nanjing King-Friend Biochemical PharmaceuticalLtd

To quote Buffett, 'Ships will sail around the world but the Flat Earth Society will flourish. There will continue to be wide discrepancies between price and value in the marketplace...' 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).

Nanjing King-Friend Biochemical PharmaceuticalLtd 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. However, we can say we'd expect to see a falling share price in this scenario.

The company's earnings per share (over time) is depicted in the image below (click to see the exact numbers).

Dive deeper into Nanjing King-Friend Biochemical PharmaceuticalLtd's key metrics by checking this interactive graph of Nanjing King-Friend Biochemical PharmaceuticalLtd's earnings, revenue and cash flow.

A Different Perspective

Nanjing King-Friend Biochemical PharmaceuticalLtd shareholders are down 11% for the year (even including dividends), but the market itself is up 6.1%. 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. Unfortunately, last year's performance may indicate unresolved challenges, given that it was worse than the annualised loss of 7% over the last half decade. 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 Nanjing King-Friend Biochemical PharmaceuticalLtd better, we need to consider many other factors. For example, we've discovered 1 warning sign for Nanjing King-Friend Biochemical PharmaceuticalLtd that you should be aware of before investing here.

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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.