Investors three-year losses continue as Anton Oilfield Services Group (HKG:3337) dips a further 15% this week, earnings continue to decline

By
Simply Wall St
Published
March 16, 2022
SEHK:3337
Source: Shutterstock

If you are building a properly diversified stock portfolio, the chances are some of your picks will perform badly. But long term Anton Oilfield Services Group (HKG:3337) shareholders have had a particularly rough ride in the last three year. Sadly for them, the share price is down 63% in that time. And over the last year the share price fell 32%, so we doubt many shareholders are delighted. More recently, the share price has dropped a further 20% in a month. But this could be related to poor market conditions -- stocks are down 23% in the same time.

Since Anton Oilfield Services Group has shed CN¥204m from its value in the past 7 days, let's see if the longer term decline has been driven by the business' economics.

Check out our latest analysis for Anton Oilfield Services Group

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.

During the three years that the share price fell, Anton Oilfield Services Group's earnings per share (EPS) dropped by 35% each year. In comparison the 28% compound annual share price decline isn't as bad as the EPS drop-off. So, despite the prior disappointment, shareholders must have some confidence the situation will improve, longer term.

You can see below how EPS has changed over time (discover the exact values by clicking on the image).

earnings-per-share-growth
SEHK:3337 Earnings Per Share Growth March 16th 2022

We know that Anton Oilfield Services Group has improved its bottom line lately, but is it going to grow revenue? This free report showing analyst revenue forecasts should help you figure out if the EPS growth can be sustained.

A Different Perspective

The total return of 32% received by Anton Oilfield Services Group shareholders over the last year isn't far from the market return of -31%. Unfortunately, last year's performance is a deterioration of an already poor long term track record, given the loss of 10% per year over the last five years. Weak performance over the long term usually destroys market confidence in a stock, but bargain hunters may want to take a closer look for signs of a turnaround. I find it very interesting to look at share price over the long term as a proxy for business performance. But to truly gain insight, we need to consider other information, too. Like risks, for instance. Every company has them, and we've spotted 2 warning signs for Anton Oilfield Services Group (of which 1 can't be ignored!) you should know about.

Of course Anton Oilfield Services Group may not be the best stock to buy. So you may wish to see this free collection of growth stocks.

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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