Tus-Pharmaceutical Group (SZSE:000590 shareholders incur further losses as stock declines 19% this week, taking five-year losses to 48%

In order to justify the effort of selecting individual stocks, it's worth striving to beat the returns from a market index fund. But every investor is virtually certain to have both over-performing and under-performing stocks. At this point some shareholders may be questioning their investment in Tus-Pharmaceutical Group Co., Ltd. (SZSE:000590), since the last five years saw the share price fall 48%. And some of the more recent buyers are probably worried, too, with the stock falling 34% in the last year. And the share price decline continued over the last week, dropping some 19%.

After losing 19% 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 Tus-Pharmaceutical Group

We don't think that Tus-Pharmaceutical Group's modest trailing twelve month profit has the market's full attention at the moment. We think revenue is probably a better guide. Generally speaking, we'd consider a stock like this alongside loss-making companies, simply because the quantum of the profit is so low. It would be hard to believe in a more profitable future without growing revenues.

Over five years, Tus-Pharmaceutical Group grew its revenue at 9.4% 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 8% each year for half a decade. Those who bought back then clearly believed in stronger growth - and maybe even profits. The lesson is that if you buy shares in a money losing company you could end up losing money.

You can see below how earnings and revenue have changed over time (discover the exact values by clicking on the image).

We're pleased to report that the CEO is remunerated more modestly than most CEOs at similarly capitalized companies. But while CEO remuneration is always worth checking, the really important question is whether the company can grow earnings going forward. It might be well worthwhile taking a look at our free report on Tus-Pharmaceutical Group's earnings, revenue and cash flow.

A Different Perspective

While the broader market lost about 11% in the twelve months, Tus-Pharmaceutical Group shareholders did even worse, losing 34%. However, it could simply be that the share price has been impacted by broader market jitters. It might be worth keeping an eye on the fundamentals, in case there's a good opportunity. Unfortunately, last year's performance may indicate unresolved challenges, given that it was worse than the annualised loss of 8% over the last half decade. We realise that Baron Rothschild has said investors should "buy when there is blood on the streets", but we caution that investors should first be sure they are buying a high quality business. It's always interesting to track share price performance over the longer term. But to understand Tus-Pharmaceutical Group better, we need to consider many other factors. For instance, we've identified 2 warning signs for Tus-Pharmaceutical Group that you should be aware of.

For those who like to find winning investments this free list of undervalued companies with recent insider purchasing, could be just the ticket.

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.