Investors five-year losses continue as Osung Advanced Materials (KOSDAQ:052420) dips a further 11% this week, earnings continue to decline

Generally speaking long term investing is the way to go. But that doesn't mean long term investors can avoid big losses. For example the Osung Advanced Materials Co., Ltd. (KOSDAQ:052420) share price dropped 68% over five years. We certainly feel for shareholders who bought near the top. Unfortunately the share price momentum is still quite negative, with prices down 11% in thirty days.

After losing 11% this past week, it's worth investigating the company's fundamentals to see what we can infer from past performance.

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To paraphrase Benjamin Graham: Over the short term the market is a voting machine, but over the long term it's a weighing machine. 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 five years of share price growth, Osung Advanced Materials moved from a loss to profitability. That would generally be considered a positive, so we are surprised to see the share price is down. Other metrics may better explain the share price move.

In contrast to the share price, revenue has actually increased by 13% a year in the five year period. So it seems one might have to take closer look at the fundamentals to understand why the share price languishes. After all, there may be an opportunity.

The graphic below depicts how earnings and revenue have changed over time (unveil the exact values by clicking on the image).

This free interactive report on Osung Advanced Materials' balance sheet strength is a great place to start, if you want to investigate the stock further.

A Different Perspective

Investors in Osung Advanced Materials had a tough year, with a total loss of 15%, against a market gain of about 60%. However, keep in mind that even the best stocks will sometimes underperform the market over a twelve month period. Unfortunately, longer term shareholders are suffering worse, given the loss of 11% doled out over the last five years. We'd need to see some sustained improvements in the key metrics before we could muster much enthusiasm. It's always interesting to track share price performance over the longer term. But to understand Osung Advanced Materials better, we need to consider many other factors. Take risks, for example - Osung Advanced Materials has 3 warning signs (and 1 which is concerning) we think you should know about.

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Please note, the market returns quoted in this article reflect the market weighted average returns of stocks that currently trade on South Korean 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.