Inkeverse Group Limited (HKG:3700) has rebounded strongly over the last week, with the share price soaring 40%. But don't envy holders -- looking back over 5 years the returns have been really bad. Indeed, the share price is down 56% in the period. So we're hesitant to put much weight behind the short term increase. However, in the best case scenario (far from fait accompli), this improved performance might be sustained.

While the stock has risen 40% 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 Inkeverse Group

There is no denying that markets are sometimes efficient, but prices do not always reflect underlying business performance. One way to examine how market sentiment has changed over time is to look at the interaction between a company's share price and its earnings per share (EPS).

Looking back five years, both Inkeverse Group's share price and EPS declined; the latter at a rate of 42% per year. The share price decline of 15% per year isn't as bad as the EPS decline. The relatively muted share price reaction might be because the market expects the business to turn around.

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

It might be well worthwhile taking a look at our free report on Inkeverse Group's earnings, revenue and cash flow.

A Different Perspective

It's nice to see that Inkeverse Group shareholders have received a total shareholder return of 13% over the last year. There's no doubt those recent returns are much better than the TSR loss of 9% per year over five years. This makes us a little wary, but the business might have turned around its fortunes. It's always interesting to track share price performance over the longer term. But to understand Inkeverse Group better, we need to consider many other factors. Case in point: We've spotted 2 warning signs for Inkeverse Group you should be aware of, and 1 of them doesn't sit too well with us.

We will like Inkeverse Group better if we see some big insider buys. While we wait, check out this free list of growing companies with considerable, recent, insider buying.

Please note, the market returns quoted in this article reflect the market weighted average returns of stocks that currently trade on Hong Kong 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.