Zall Smart Commerce Group (HKG:2098) earnings and shareholder returns have been trending downwards for the last five years, but the stock hikes 13% this past week

It's nice to see the Zall Smart Commerce Group Ltd. (HKG:2098) share price up 13% in a week. But that is little comfort to those holding over the last half decade, sitting on a big loss. Indeed, the share price is down 56% in the period. So we're hesitant to put much weight behind the short term increase. But it could be that the fall was overdone.

The recent uptick of 13% could be a positive sign of things to come, so let's take a look at historical fundamentals.

Check out our latest analysis for Zall Smart Commerce Group

While markets are a powerful pricing mechanism, share prices reflect investor sentiment, not just underlying business performance. One way to examine how market sentiment has changed over time is to look at the interaction between a company's share price and its earnings per share (EPS).

During five years of share price growth, Zall Smart Commerce Group moved from a loss to profitability. That would generally be considered a positive, so we are surprised to see the share price is down. Other metrics might give us a better handle on how its value is changing over time.

In contrast to the share price, revenue has actually increased by 14% a year in the five year period. A more detailed examination of the revenue and earnings may or may not explain why the share price languishes; there could be an opportunity.

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

We're pleased to report that the CEO is remunerated more modestly than most CEOs at similarly capitalized companies. But while CEO remuneration is always worth checking, the really important question is whether the company can grow earnings going forward. Before buying or selling a stock, we always recommend a close examination of historic growth trends, available here..

A Different Perspective

Zall Smart Commerce Group shareholders gained a total return of 11% during the year. But that return falls short of the market. But at least that's still a gain! Over five years the TSR has been a reduction of 9% per year, over five years. So this might be a sign the business has turned its fortunes around. It's always interesting to track share price performance over the longer term. But to understand Zall Smart Commerce Group better, we need to consider many other factors. For example, we've discovered 4 warning signs for Zall Smart Commerce Group (2 make us uncomfortable!) that you should be aware of before investing here.

If you would prefer to check out another company -- one with potentially superior financials -- then do not miss this free list of companies that have proven they can grow earnings.

Please note, the market returns quoted in this article reflect the market weighted average returns of stocks that currently trade on Hong Kong 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.