The one-year returns have been solid for Shineco (NASDAQ:TYHT) shareholders despite underlying losses increasing

By
Simply Wall St
Published
August 29, 2021
NasdaqCM:SISI
Source: Shutterstock

Unfortunately, investing is risky - companies can and do go bankrupt. But when you pick a company that is really flourishing, you can make more than 100%. For example, the Shineco, Inc. (NASDAQ:TYHT) share price had more than doubled in just one year - up 189%. And in the last month, the share price has gained 108%. On the other hand, longer term shareholders have had a tougher run, with the stock falling 9.5% in three years.

Since it's been a strong week for Shineco shareholders, let's have a look at trend of the longer term fundamentals.

View our latest analysis for Shineco

Shineco isn't currently profitable, so most analysts would look to revenue growth to get an idea of how fast the underlying business is growing. When a company doesn't make profits, we'd generally expect to see good revenue growth. As you can imagine, fast revenue growth, when maintained, often leads to fast profit growth.

In the last year Shineco saw its revenue shrink by 46%. We're a little surprised to see the share price pop 189% in the last year. It just goes to show the market doesn't always pay attention to the reported numbers. It's quite likely the revenue fall was already priced in, anyway.

You can see below how earnings and revenue have changed over time (discover the exact values by clicking on the image).

earnings-and-revenue-growth
NasdaqCM:TYHT Earnings and Revenue Growth August 30th 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

We're pleased to report that Shineco rewarded shareholders with a total shareholder return of 189% over the last year. What is absolutely clear is that is far preferable to the dismal 3.1% average annual loss suffered over the last three years. We're generally cautious about putting too much weigh on shorter term data, but the recent improvement is definitely a positive. It's always interesting to track share price performance over the longer term. But to understand Shineco better, we need to consider many other factors. Consider for instance, the ever-present spectre of investment risk. We've identified 4 warning signs with Shineco (at least 2 which are significant) , and understanding them should be part of your investment process.

Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of companies we expect will grow earnings.

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

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