JS Global Lifestyle (HKG:1691) earnings and shareholder returns have been trending downwards for the last year, but the stock pops 13% this past week

This week we saw the JS Global Lifestyle Company Limited (HKG:1691) share price climb by 13%. But that doesn't change the fact that the returns over the last year have been stomach churning. Specifically, the stock price nose-dived 84% in that time. It's not uncommon to see a bounce after a drop like that. The bigger issue is whether the company can sustain the momentum in the long term. While a drop like that is definitely a body blow, money isn't as important as health and happiness.

While the last year has been tough for JS Global Lifestyle shareholders, this past week has shown signs of promise. So let's look at the longer term fundamentals and see if they've been the driver of the negative returns.

See our latest analysis for JS Global Lifestyle

While the efficient markets hypothesis continues to be taught by some, it has been proven that markets are over-reactive dynamic systems, and investors are not always rational. By comparing earnings per share (EPS) and share price changes over time, we can get a feel for how investor attitudes to a company have morphed over time.

Unhappily, JS Global Lifestyle had to report a 21% decline in EPS over the last year. This reduction in EPS is not as bad as the 84% share price fall. So it seems the market was too confident about the business, a year ago. The less favorable sentiment is reflected in its current P/E ratio of 1.84.

The company's earnings per share (over time) is depicted in the image below (click to see the exact numbers).

It is of course excellent to see how JS Global Lifestyle has grown profits over the years, but the future is more important for shareholders. This free interactive report on JS Global Lifestyle's balance sheet strength is a great place to start, if you want to investigate the stock further.

A Different Perspective

JS Global Lifestyle shareholders are down 84% for the year, but the broader market is up 3.2%. However, keep in mind that even the best stocks will sometimes underperform the market over a twelve month period. The three-year loss of 22% per year isn't as bad as the last twelve months, suggesting that the company has not been able to convince the market it has solved its problems. Although Baron Rothschild famously said to "buy when there's blood in the streets, even if the blood is your own", he also focusses on high quality stocks with solid prospects. It's always interesting to track share price performance over the longer term. But to understand JS Global Lifestyle better, we need to consider many other factors. Even so, be aware that JS Global Lifestyle is showing 1 warning sign in our investment analysis , you should know about...

But note: JS Global Lifestyle 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 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.