It's easy to match the overall market return by buying an index fund. When you buy individual stocks, you can make higher profits, but you also face the risk of under-performance. For example, the Yongan Futures Co.,Ltd. (SHSE:600927) share price is down 43% in the last year. That's well below the market decline of 20%. Because Yongan FuturesLtd hasn't been listed for many years, the market is still learning about how the business performs. The last week also saw the share price slip down another 6.4%. But this could be related to the soft market, which is down about 4.5% in the same period.

Given the past week has been tough on shareholders, let's investigate the fundamentals and see what we can learn.

See our latest analysis for Yongan FuturesLtd

In his essay The Superinvestors of Graham-and-Doddsville Warren Buffett described how share prices do not always rationally reflect the value of a business. By comparing earnings per share (EPS) and share price changes over time, we can get a feel for how investor attitudes to a company have morphed over time.

Unfortunately Yongan FuturesLtd reported an EPS drop of 35% for the last year. We note that the 43% share price drop is very close to the EPS drop. Therefore one could posit that the market has not become more concerned about the company, despite the lower EPS. Rather, the share price has approximately tracked EPS growth.

The graphic below depicts how EPS has changed over time (unveil the exact values by clicking on the image).

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

A Different Perspective

We doubt Yongan FuturesLtd shareholders are happy with the loss of 42% over twelve months (even including dividends). That falls short of the market, which lost 20%. That's disappointing, but it's worth keeping in mind that the market-wide selling wouldn't have helped. The share price decline has continued throughout the most recent three months, down 5.6%, suggesting an absence of enthusiasm from investors. Basically, most investors should be wary of buying into a poor-performing stock, unless the business itself has clearly improved. It's always interesting to track share price performance over the longer term. But to understand Yongan FuturesLtd better, we need to consider many other factors. To that end, you should be aware of the 2 warning signs we've spotted with Yongan FuturesLtd .

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.