Further weakness as Fujian Forecam Optics (SHSE:688010) drops 16% this week, taking five-year losses to 23%

Fujian Forecam Optics Co., Ltd. (SHSE:688010) shareholders will doubtless be very grateful to see the share price up 120% in the last quarter. But if you look at the last five years the returns have not been good. In fact, the share price is down 24%, which falls well short of the return you could get by buying an index fund.

After losing 16% 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 Fujian Forecam Optics

Fujian Forecam Optics 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, Fujian Forecam Optics saw its revenue increase by 2.6% per year. That's far from impressive given all the money it is losing. Given the weak growth, the share price fall of 4% isn't particularly surprising. Investors should consider how bad the losses are, and whether the company can make it to profitability with ease. It could be worth putting it on your watchlist and revisiting when it makes its maiden profit.

You can see how earnings and revenue have changed over time in the image below (click on the chart to see the exact values).

Take a more thorough look at Fujian Forecam Optics' financial health with this free report on its balance sheet.

A Different Perspective

It's nice to see that Fujian Forecam Optics shareholders have received a total shareholder return of 22% over the last year. That certainly beats the loss of about 4% 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. 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. For instance, we've identified 2 warning signs for Fujian Forecam Optics that you should be aware of.

But note: Fujian Forecam Optics may not be the best stock to buy. So take a peek at this free list of interesting companies with past earnings growth (and further growth forecast).

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.