Earthasia International Holdings' (HKG:6128) Shareholders Are Down 67% On Their Shares

Earthasia International Holdings Limited (HKG:6128) shareholders should be happy to see the share price up 25% in the last month. But that doesn't change the fact that the returns over the last year have been disappointing. Like a receding glacier in a warming world, the share price has melted 67% in that period. Some might say the recent bounce is to be expected after such a bad drop. Of course, it could be that the fall was overdone.

View our latest analysis for Earthasia International Holdings

Earthasia International Holdings wasn't profitable in the last twelve months, it is unlikely we'll see a strong correlation between its share price and its earnings per share (EPS). Arguably revenue is our next best option. Shareholders of unprofitable companies usually expect strong revenue growth. That's because fast revenue growth can be easily extrapolated to forecast profits, often of considerable size.

In the last year Earthasia International Holdings saw its revenue grow by 98%. That's a strong result which is better than most other loss making companies. Meanwhile, the share price slid 67%. This could mean hype has come out of the stock because the bottom line is concerning investors. Generally speaking investors would consider a stock like this less risky once it turns a profit. But when do you think that will happen?

You can see below how earnings and revenue have changed over time (discover the exact values by clicking on the image).

It's good to see that there was some significant insider buying in the last three months. That's a positive. That said, we think earnings and revenue growth trends are even more important factors to consider. Dive deeper into the earnings by checking this interactive graph of Earthasia International Holdings' earnings, revenue and cash flow.

A Different Perspective

While the broader market gained around 25% in the last year, Earthasia International Holdings shareholders lost 67%. Even the share prices of good stocks drop sometimes, but we want to see improvements in the fundamental metrics of a business, before getting too interested. Longer term investors wouldn't be so upset, since they would have made 7%, 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. It's always interesting to track share price performance over the longer term. But to understand Earthasia International Holdings better, we need to consider many other factors. Case in point: We've spotted 5 warning signs for Earthasia International Holdings you should be aware of, and 1 of them doesn't sit too well with us.

Earthasia International Holdings is not the only stock that insiders are buying. For those who like to find winning investments this free list of growing 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 HK exchanges.

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This article by Simply Wall St is general in nature. 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.
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