Beijing Jingyuntong Technology (SHSE:601908) shareholders are up 7.4% this past week, but still in the red over the last three years

As an investor, mistakes are inevitable. But really bad investments should be rare. So consider, for a moment, the misfortune of Beijing Jingyuntong Technology Co., Ltd. (SHSE:601908) investors who have held the stock for three years as it declined a whopping 76%. That would certainly shake our confidence in the decision to own the stock. And more recent buyers are having a tough time too, with a drop of 55% in the last year. Furthermore, it's down 29% in about a quarter. That's not much fun for holders.

The recent uptick of 7.4% could be a positive sign of things to come, so let's take a look at historical fundamentals.

Check out our latest analysis for Beijing Jingyuntong Technology

While markets are a powerful pricing mechanism, share prices reflect investor sentiment, not just 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).

Over the three years that the share price declined, Beijing Jingyuntong Technology's earnings per share (EPS) dropped significantly, 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!

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

Dive deeper into Beijing Jingyuntong Technology's key metrics by checking this interactive graph of Beijing Jingyuntong Technology's earnings, revenue and cash flow.

A Different Perspective

While the broader market lost about 20% in the twelve months, Beijing Jingyuntong Technology shareholders did even worse, losing 55% (even including dividends). Having said that, it's inevitable that some stocks will be oversold in a falling market. The key is to keep your eyes on the fundamental developments. Unfortunately, last year's performance may indicate unresolved challenges, given that it was worse than the annualised loss of 3% 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 Beijing Jingyuntong Technology better, we need to consider many other factors. For example, we've discovered 2 warning signs for Beijing Jingyuntong Technology that you should be aware of before investing here.

If you are like me, then you will not want to miss this free list of undervalued small caps that insiders are buying.

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