Investors are selling off Beijing Teamsun TechnologyLtd (SHSE:600410), lack of profits no doubt contribute to shareholders five-year loss

It is a pleasure to report that the Beijing Teamsun Technology Co.,Ltd. (SHSE:600410) is up 48% in the last quarter. But over the last half decade, the stock has not performed well. You would have done a lot better buying an index fund, since the stock has dropped 30% in that half decade.

With the stock having lost 9.2% in the past week, it's worth taking a look at business performance and seeing if there's any red flags.

See our latest analysis for Beijing Teamsun TechnologyLtd

Beijing Teamsun TechnologyLtd isn't currently profitable, so most analysts would look to revenue growth to get an idea of how fast the underlying business is growing. When a company doesn't make profits, we'd generally hope to see good revenue growth. As you can imagine, fast revenue growth, when maintained, often leads to fast profit growth.

In the last half decade, Beijing Teamsun TechnologyLtd saw its revenue increase by 0.03% per year. That's not a very high growth rate considering it doesn't make profits. Given this fairly low revenue growth (and lack of profits), it's not particularly surprising to see the stock down 5% (annualized) in the same time frame. The key question is whether the company can make it to profitability, and beyond, without trouble. Shareholders will want the company to approach profitability if it can't grow revenue any faster.

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

Take a more thorough look at Beijing Teamsun TechnologyLtd's financial health with this free report on its balance sheet.

A Different Perspective

It's good to see that Beijing Teamsun TechnologyLtd has rewarded shareholders with a total shareholder return of 13% in the last twelve months. That certainly beats the loss of about 5% per year over the last half decade. The long term loss makes us cautious, but the short term TSR gain certainly hints at a brighter future. I find it very interesting to look at share price over the long term as a proxy for business performance. But to truly gain insight, we need to consider other information, too. Like risks, for instance. Every company has them, and we've spotted 2 warning signs for Beijing Teamsun TechnologyLtd (of which 1 is significant!) you should know about.

Of course Beijing Teamsun TechnologyLtd 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.

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

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.