It hasn't been the best quarter for Jiangsu Gian Technology Co., Ltd. (SZSE:300709) shareholders, since the share price has fallen 13% in that time. But that doesn't change the fact that the returns over the last three years have been pleasing. In the last three years the share price is up, 47%: better than the market.

Since the stock has added CN¥492m to its market cap in the past week alone, let's see if underlying performance has been driving long-term returns.

Check out our latest analysis for Jiangsu Gian Technology

While markets are a powerful pricing mechanism, share prices reflect investor sentiment, not just underlying business performance. 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 three years of share price growth, Jiangsu Gian Technology achieved compound earnings per share growth of 69% per year. This EPS growth is higher than the 14% average annual increase in the share price. So one could reasonably conclude that the market has cooled on the stock.

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

We know that Jiangsu Gian Technology has improved its bottom line over the last three years, but what does the future have in store? 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 Jiangsu Gian Technology rewarded shareholders with a total shareholder return of 37% over the last year. And yes, that does include the dividend. That gain actually surpasses the 14% TSR it generated (per year) over three years. Given the track record of solid returns over varying time frames, it might be worth putting Jiangsu Gian Technology on your watchlist. I find it very interesting to look at share price over the long term as a proxy for business performance. But to truly gain insight, we need to consider other information, too. Consider for instance, the ever-present spectre of investment risk. We've identified 3 warning signs with Jiangsu Gian Technology , 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 CN 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.