If you love investing in stocks you're bound to buy some losers. Long term Bank of Gansu Co., Ltd. (HKG:2139) shareholders know that all too well, since the share price is down considerably over three years. Regrettably, they have had to cope with a 55% drop in the share price over that period.

After losing 3.8% this past week, it's worth investigating the company's fundamentals to see what we can infer from past performance.

See our latest analysis for Bank of Gansu

While the efficient markets hypothesis continues to be taught by some, it has been proven that markets are over-reactive dynamic systems, and investors are not always rational. One way to examine how market sentiment has changed over time is to look at the interaction between a company's share price and its earnings per share (EPS).

Bank of Gansu saw its EPS decline at a compound rate of 52% per year, over the last three years. In comparison the 23% compound annual share price decline isn't as bad as the EPS drop-off. So the market may not be too worried about the EPS figure, at the moment -- or it may have previously priced some of the drop in.

The image below shows how EPS has tracked over time (if you click on the image you can see greater detail).

Before buying or selling a stock, we always recommend a close examination of historic growth trends, available here.

What about the Total Shareholder Return (TSR)?

We've already covered Bank of Gansu's share price action, but we should also mention its total shareholder return (TSR). Arguably the TSR is a more complete return calculation because it accounts for the value of dividends (as if they were reinvested), along with the hypothetical value of any discounted capital that have been offered to shareholders. Bank of Gansu's TSR of was a loss of 52% for the 3 years. That wasn't as bad as its share price return, because it has paid dividends.

A Different Perspective

We can sympathize with Bank of Gansu about their 20% loss for the year, but the silver lining is that the broader market return was worse, at around -24%. The one-year return is also not as bad as the 15% per annum loss investors have suffered over the last three years. It is of course not much comfort to know that the losses have slowed. Shareholders will be hoping for a proper turnaround, no doubt. While it is well worth considering the different impacts that market conditions can have on the share price, there are other factors that are even more important. Case in point: We've spotted 1 warning sign for Bank of Gansu you should be aware of.

If you like to buy stocks alongside management, then you might just love this free list of companies. (Hint: insiders have been buying them).

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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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.