SHENZHEN TOPRAYSOLARLtd (SZSE:002218 shareholders incur further losses as stock declines 8.1% this week, taking three-year losses to 45%

While it may not be enough for some shareholders, we think it is good to see the SHENZHEN TOPRAYSOLAR Co.,Ltd. (SZSE:002218) share price up 25% in a single quarter. But that doesn't change the fact that the returns over the last three years have been less than pleasing. After all, the share price is down 46% in the last three years, significantly under-performing the market.

With the stock having lost 8.1% in the past week, it's worth taking a look at business performance and seeing if there's any red flags.

View our latest analysis for SHENZHEN TOPRAYSOLARLtd

There is no denying that markets are sometimes efficient, but prices do not always reflect underlying business performance. 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.

SHENZHEN TOPRAYSOLARLtd saw its share price decline over the three years in which its EPS also dropped, falling to a loss. Since the company has fallen to a loss making position, it's hard to compare the change in EPS with the share price change. However, we can say we'd expect to see a falling share price in this scenario.

You can see how EPS has changed over time in the image below (click on the chart to see the exact values).

It might be well worthwhile taking a look at our free report on SHENZHEN TOPRAYSOLARLtd's earnings, revenue and cash flow.

A Different Perspective

Investors in SHENZHEN TOPRAYSOLARLtd had a tough year, with a total loss of 13% (including dividends), against a market gain of about 12%. 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. Longer term investors wouldn't be so upset, since they would have made 4%, each year, over five years. It could be that the recent sell-off is an opportunity, so it may be worth checking the fundamental data for signs of a long term growth trend. 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. Take risks, for example - SHENZHEN TOPRAYSOLARLtd has 2 warning signs we think 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.