Investing in stocks comes with the risk that the share price will fall. And there's no doubt that Unionman Technology Co., Ltd. (SHSE:688609) stock has had a really bad year. The share price is down a hefty 53% in that time. We wouldn't rush to judgement on Unionman Technology because we don't have a long term history to look at. Shareholders have had an even rougher run lately, with the share price down 24% in the last 90 days.

After losing 8.6% 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 Unionman Technology

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 flawed but reasonable way to assess how sentiment around a company has changed is to compare the earnings per share (EPS) with the share price.

Unhappily, Unionman Technology had to report a 25% decline in EPS over the last year. The share price decline of 53% is actually more than the EPS drop. This suggests the EPS fall has made some shareholders are more nervous about the business.

The company's earnings per share (over time) is depicted in the image below (click to see the exact numbers).

Dive deeper into Unionman Technology's key metrics by checking this interactive graph of Unionman Technology's earnings, revenue and cash flow.

A Different Perspective

We doubt Unionman Technology shareholders are happy with the loss of 53% over twelve months (even including dividends). That falls short of the market, which lost 5.0%. There's no doubt that's a disappointment, but the stock may well have fared better in a stronger market. With the stock down 24% over the last three months, the market doesn't seem to believe that the company has solved all its problems. Basically, most investors should be wary of buying into a poor-performing stock, unless the business itself has clearly improved. 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. For example, we've discovered 3 warning signs for Unionman Technology that you should be aware of before investing here.

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 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.