Despite the downward trend in earnings at Shenzhen Mason TechnologiesLtd (SZSE:002654) the stock lifts 5.0%, bringing three-year gains to 214%

The most you can lose on any stock (assuming you don't use leverage) is 100% of your money. But if you buy shares in a really great company, you can more than double your money. For instance the Shenzhen Mason Technologies Co.,Ltd (SZSE:002654) share price is 214% higher than it was three years ago. That sort of return is as solid as granite. In more good news, the share price has risen 23% in thirty days. But this could be related to good market conditions -- stocks in its market are up 21% in the last month.

The past week has proven to be lucrative for Shenzhen Mason TechnologiesLtd investors, so let's see if fundamentals drove the company's three-year performance.

View our latest analysis for Shenzhen Mason TechnologiesLtd

To paraphrase Benjamin Graham: Over the short term the market is a voting machine, but over the long term it's a weighing machine. One flawed but reasonable way to assess how sentiment around a company has changed is to compare the earnings per share (EPS) with the share price.

Shenzhen Mason TechnologiesLtd became profitable within the last three years. That kind of transition can be an inflection point that justifies a strong share price gain, just as we have seen here.

You can see below how EPS has changed over time (discover the exact values by clicking on the image).

Dive deeper into Shenzhen Mason TechnologiesLtd's key metrics by checking this interactive graph of Shenzhen Mason TechnologiesLtd's earnings, revenue and cash flow.

A Different Perspective

Investors in Shenzhen Mason TechnologiesLtd had a tough year, with a total loss of 19%, against a market gain of about 2.2%. However, keep in mind that even the best stocks will sometimes underperform the market over a twelve month period. Longer term investors wouldn't be so upset, since they would have made 22%, each year, over five years. If the fundamental data continues to indicate long term sustainable growth, the current sell-off could be an opportunity worth considering. 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. Consider risks, for instance. Every company has them, and we've spotted 1 warning sign for Shenzhen Mason TechnologiesLtd you should know about.

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.