Shanghai Kaytune Industrial Co.,Ltd (SZSE:301001) shareholders will doubtless be very grateful to see the share price up 44% in the last quarter. But that is minimal compensation for the share price under-performance over the last year. In fact, the price has declined 11% in a year, falling short of the returns you could get by investing in an index fund.

While the stock has risen 28% in the past week but long term shareholders are still in the red, let's see what the fundamentals can tell us.

Check out our latest analysis for Shanghai Kaytune IndustrialLtd

Given that Shanghai Kaytune IndustrialLtd only made minimal earnings in the last twelve months, we'll focus on revenue to gauge its business development. Generally speaking, we'd consider a stock like this alongside loss-making companies, simply because the quantum of the profit is so low. For shareholders to have confidence a company will grow profits significantly, it must grow revenue.

In just one year Shanghai Kaytune IndustrialLtd saw its revenue fall by 4.8%. That's not what investors generally want to see. The stock price has languished lately, falling 11% in a year. That seems pretty reasonable given the lack of both profits and revenue growth. It's hard to escape the conclusion that buyers must envision either growth down the track, cost cutting, or both.

You can see how earnings and revenue have changed over time in the image below (click on the chart to see the exact values).

Take a more thorough look at Shanghai Kaytune IndustrialLtd's financial health with this free report on its balance sheet.

A Different Perspective

While Shanghai Kaytune IndustrialLtd shareholders are down 10% for the year (even including dividends), the market itself is up 4.6%. While the aim is to do better than that, it's worth recalling that even great long-term investments sometimes underperform for a year or more. It's great to see a nice little 44% rebound in the last three months. This could just be a bounce because the selling was too aggressive, but fingers crossed it's the start of a new trend. 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. For example, we've discovered 4 warning signs for Shanghai Kaytune IndustrialLtd (2 make us uncomfortable!) that you should be aware of before investing here.

For those who like to find winning investments this free list of growing companies with recent insider purchasing, could be just the ticket.

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.