Despite shrinking by HK$93m in the past week, Glory Health Industry (HKG:2329) shareholders are still up 220% over 1 year

It's been a soft week for Glory Health Industry Limited (HKG:2329) shares, which are down 16%. But that doesn't change the fact that the returns over the last year have been very strong. Like an eagle, the share price soared 220% in that time. So some might not be surprised to see the price retrace some. The real question is whether the business is trending in the right direction.

While this past week has detracted from the company's one-year return, let's look at the recent trends of the underlying business and see if the gains have been in alignment.

Check out our latest analysis for Glory Health Industry

Glory Health Industry 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. When a company doesn't make profits, we'd generally hope to see good revenue growth. As you can imagine, fast revenue growth, when maintained, often leads to fast profit growth.

Glory Health Industry actually shrunk its revenue over the last year, with a reduction of 16%. So we would not have expected the share price to rise 220%. This is a good example of how buyers can push up prices even before the fundamental metrics show much growth. It's quite likely the revenue fall was already priced in, anyway.

You can see how earnings and revenue have changed over time in the image below (click on the chart to see the exact values).

If you are thinking of buying or selling Glory Health Industry stock, you should check out this FREE detailed report on its balance sheet.

A Different Perspective

It's nice to see that Glory Health Industry shareholders have received a total shareholder return of 220% over the last year. Notably the five-year annualised TSR loss of 14% per year compares very unfavourably with the recent share price performance. The long term loss makes us cautious, but the short term TSR gain certainly hints at a brighter future. It's always interesting to track share price performance over the longer term. But to understand Glory Health Industry better, we need to consider many other factors. Like risks, for instance. Every company has them, and we've spotted 4 warning signs for Glory Health Industry (of which 2 make us uncomfortable!) you should know about.

We will like Glory Health Industry better if we see some big insider buys. While we wait, check out this free list of undervalued stocks (mostly small caps) with considerable, recent, insider buying.

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.