The past three-year earnings decline for Shenzhen Yitoa Intelligent ControlLtd (SZSE:300131) likely explains shareholders long-term losses

Shenzhen Yitoa Intelligent Control Co.,Ltd. (SZSE:300131) shareholders should be happy to see the share price up 21% in the last quarter. It's not great that the stock is down over the last three years. But that's not so bad when you consider its market is down 26%.

While the stock has risen 6.5% in the past week but long term shareholders are still in the red, let's see what the fundamentals can tell us.

View our latest analysis for Shenzhen Yitoa Intelligent ControlLtd

To quote Buffett, 'Ships will sail around the world but the Flat Earth Society will flourish. There will continue to be wide discrepancies between price and value in the marketplace...' One imperfect but simple way to consider how the market perception of a company has shifted is to compare the change in the earnings per share (EPS) with the share price movement.

During the three years that the share price fell, Shenzhen Yitoa Intelligent ControlLtd's earnings per share (EPS) dropped by 44% each year. This fall in the EPS is worse than the 8% compound annual share price fall. So the market may not be too worried about the EPS figure, at the moment -- or it may have previously priced some of the drop in. With a P/E ratio of 103.55, it's fair to say the market sees a brighter future for the business.

The graphic below depicts how EPS has changed over time (unveil the exact values by clicking on the image).

Before buying or selling a stock, we always recommend a close examination of historic growth trends, available here.

A Different Perspective

It's nice to see that Shenzhen Yitoa Intelligent ControlLtd shareholders have received a total shareholder return of 4.5% over the last year. Notably the five-year annualised TSR loss of 1.4% per year compares very unfavourably with the recent share price performance. The long term loss makes us cautious, but the short term TSR gain certainly hints at a brighter future. It's always interesting to track share price performance over the longer term. But to understand Shenzhen Yitoa Intelligent ControlLtd better, we need to consider many other factors. For example, we've discovered 2 warning signs for Shenzhen Yitoa Intelligent ControlLtd that you should be aware of before investing here.

But note: Shenzhen Yitoa Intelligent ControlLtd 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.