Qtone Education Group (Guangdong)Ltd (SZSE:300359 shareholders incur further losses as stock declines 13% this week, taking five-year losses to 29%

For many, the main point of investing is to generate higher returns than the overall market. But in any portfolio, there will be mixed results between individual stocks. At this point some shareholders may be questioning their investment in Qtone Education Group (Guangdong) Co.,Ltd (SZSE:300359), since the last five years saw the share price fall 29%. And we doubt long term believers are the only worried holders, since the stock price has declined 28% over the last twelve months. On top of that, the share price is down 13% in the last week.

With the stock having lost 13% 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 Qtone Education Group (Guangdong)Ltd

Because Qtone Education Group (Guangdong)Ltd made a loss in the last twelve months, we think the market is probably more focussed on revenue and revenue growth, at least for now. Generally speaking, companies without profits are expected to grow revenue every year, and at a good clip. As you can imagine, fast revenue growth, when maintained, often leads to fast profit growth.

Over half a decade Qtone Education Group (Guangdong)Ltd reduced its trailing twelve month revenue by 5.1% for each year. While far from catastrophic that is not good. The stock hasn't done well for shareholders in the last five years, falling 5%, annualized. But it doesn't surprise given the falling revenue. It might be worth watching for signs of a turnaround - buyers are probably expecting one.

The graphic below depicts how earnings and revenue have changed over time (unveil the exact values by clicking on the image).

Take a more thorough look at Qtone Education Group (Guangdong)Ltd's financial health with this free report on its balance sheet.

A Different Perspective

We regret to report that Qtone Education Group (Guangdong)Ltd shareholders are down 28% for the year. Unfortunately, that's worse than the broader market decline of 20%. 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. Regrettably, last year's performance caps off a bad run, with the shareholders facing a total loss of 5% per year over five years. 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. 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. Case in point: We've spotted 1 warning sign for Qtone Education Group (Guangdong)Ltd you should be aware of.

Of course Qtone Education Group (Guangdong)Ltd 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.

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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.