When you buy shares in a company, there is always a risk that the price drops to zero. On the other hand, if you find a high quality business to buy (at the right price) you can more than double your money! Take, for example Goldlok Holdings(Guangdong) Co.,Ltd. (SZSE:002348). Its share price is already up an impressive 102% in the last twelve months. It's also good to see the share price up 33% over the last quarter. It is also impressive that the stock is up 63% over three years, adding to the sense that it is a real winner.

Since it's been a strong week for Goldlok Holdings(Guangdong)Ltd shareholders, let's have a look at trend of the longer term fundamentals.

View our latest analysis for Goldlok Holdings(Guangdong)Ltd

Goldlok Holdings(Guangdong)Ltd wasn't profitable in the last twelve months, it is unlikely we'll see a strong correlation between its share price and its earnings per share (EPS). Arguably revenue is our next best option. Generally speaking, companies without profits are expected to grow revenue every year, and at a good clip. That's because it's hard to be confident a company will be sustainable if revenue growth is negligible, and it never makes a profit.

In the last year Goldlok Holdings(Guangdong)Ltd saw its revenue shrink by 23%. We're a little surprised to see the share price pop 102% in the last year. This is a good example of how buyers can push up prices even before the fundamental metrics show much growth. It's quite likely the revenue fall was already priced in, anyway.

You can see below how earnings and revenue have changed over time (discover the exact values by clicking on the image).

Take a more thorough look at Goldlok Holdings(Guangdong)Ltd's financial health with this free report on its balance sheet.

A Different Perspective

It's nice to see that Goldlok Holdings(Guangdong)Ltd shareholders have received a total shareholder return of 102% over the last year. That's better than the annualised return of 2% over half a decade, implying that the company is doing better recently. Given the share price momentum remains strong, it might be worth taking a closer look at the stock, lest you miss an opportunity. It's always interesting to track share price performance over the longer term. But to understand Goldlok Holdings(Guangdong)Ltd better, we need to consider many other factors. Case in point: We've spotted 2 warning signs for Goldlok Holdings(Guangdong)Ltd you should be aware of, and 1 of them is a bit unpleasant.

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 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.