Announcing: China Investments Holdings (HKG:132) Stock Increased An Energizing 170% In The Last Year

By
Simply Wall St
Published
March 14, 2021
SEHK:132
Source: Shutterstock

The most you can lose on any stock (assuming you don't use leverage) is 100% of your money. On the other hand, if you find a high quality business to buy (at the right price) you can more than double your money! For example, the China Investments Holdings Limited (HKG:132) share price had more than doubled in just one year - up 170%. In the last week the share price is up 1.8%. Unfortunately the longer term returns are not so good, with the stock falling 14% in the last three years.

View our latest analysis for China Investments Holdings

There is no denying that markets are sometimes efficient, but prices do not always reflect underlying business performance. 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.

Over the last twelve months, China Investments Holdings actually shrank its EPS by 65%.

So we don't think that investors are paying too much attention to EPS. Since the change in EPS doesn't seem to correlate with the change in share price, it's worth taking a look at other metrics.

We think that the revenue growth of 69% could have some investors interested. We do see some companies suppress earnings in order to accelerate revenue growth.

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

earnings-and-revenue-growth
SEHK:132 Earnings and Revenue Growth March 15th 2021

Balance sheet strength is crucial. It might be well worthwhile taking a look at our free report on how its financial position has changed over time.

A Different Perspective

It's nice to see that China Investments Holdings shareholders have received a total shareholder return of 170% over the last year. That certainly beats the loss of about 4% per year over the last half decade. We generally put more weight on the long term performance over the short term, but the recent improvement could hint at a (positive) inflection point within the business. It's always interesting to track share price performance over the longer term. But to understand China Investments Holdings better, we need to consider many other factors. Even so, be aware that China Investments Holdings is showing 3 warning signs in our investment analysis , and 2 of those are concerning...

If you are like me, then you will not want to miss this free list of growing companies that insiders are buying.

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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