We think intelligent long term investing is the way to go. But along the way some stocks are going to perform badly. To wit, the Sensteed Hi-Tech Group (SZSE:000981) share price managed to fall 66% over five long years. We certainly feel for shareholders who bought near the top. And it's not just long term holders hurting, because the stock is down 26% in the last year. Unfortunately the share price momentum is still quite negative, with prices down 9.9% in thirty days.

After losing 8.7% this past week, it's worth investigating the company's fundamentals to see what we can infer from past performance.

Given that Sensteed Hi-Tech Group didn't make a profit in the last twelve months, we'll focus on revenue growth to form a quick view of its business development. Shareholders of unprofitable companies usually desire strong revenue growth. As you can imagine, fast revenue growth, when maintained, often leads to fast profit growth.

In the last five years Sensteed Hi-Tech Group saw its revenue shrink by 19% per year. That's definitely a weaker result than most pre-profit companies report. Arguably, the market has responded appropriately to this business performance by sending the share price down 11% (annualized) in the same time period. It's fair to say most investors don't like to invest in loss making companies with falling revenue. You'd want to research this company pretty thoroughly before buying, it looks a bit too risky for us.

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

This free interactive report on Sensteed Hi-Tech Group's balance sheet strength is a great place to start, if you want to investigate the stock further.

A Different Perspective

We regret to report that Sensteed Hi-Tech Group shareholders are down 26% for the year. Unfortunately, that's worse than the broader market decline of 16%. However, it could simply be that the share price has been impacted by broader market jitters. It might be worth keeping an eye on the fundamentals, in case there's a good opportunity. Unfortunately, last year's performance may indicate unresolved challenges, given that it was worse than the annualised loss of 11% over the last half decade. We realise that Baron Rothschild has said investors should "buy when there is blood on the streets", but we caution that investors should first be sure they are buying a high quality business. It's always interesting to track share price performance over the longer term. But to understand Sensteed Hi-Tech Group better, we need to consider many other factors. Case in point: We've spotted 1 warning sign for Sensteed Hi-Tech Group you should be aware of.

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 Chinese 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.