Investing in stocks comes with the risk that the share price will fall. Unfortunately, shareholders of Walvax Biotechnology Co., Ltd. (SZSE:300142) have suffered share price declines over the last year. To wit the share price is down 52% in that time. Notably, shareholders had a tough run over the longer term, too, with a drop of 49% in the last three years. Unfortunately the share price momentum is still quite negative, with prices down 10% in thirty days. However, we note the price may have been impacted by the broader market, which is down 5.0% in the same time period.

Since Walvax Biotechnology has shed CN¥3.2b from its value in the past 7 days, let's see if the longer term decline has been driven by the business' economics.

Check out our latest analysis for Walvax Biotechnology

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).

During the unfortunate twelve months during which the Walvax Biotechnology share price fell, it actually saw its earnings per share (EPS) improve by 23%. It could be that the share price was previously over-hyped.

It's fair to say that the share price does not seem to be reflecting the EPS growth. But we might find some different metrics explain the share price movements better.

Given the yield is quite low, at 0.05%, we doubt the dividend can shed much light on the share price. On the other hand, we're certainly perturbed by the 10.0% decline in Walvax Biotechnology's revenue. If the market sees the weak revenue as jeopardising EPS, that could explain the lower share price.

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

We know that Walvax Biotechnology has improved its bottom line lately, but what does the future have in store? If you are thinking of buying or selling Walvax Biotechnology stock, you should check out this free report showing analyst profit forecasts.

A Different Perspective

We regret to report that Walvax Biotechnology shareholders are down 52% for the year (even including dividends). Unfortunately, that's worse than the broader market decline of 18%. However, it could simply be that the share price has been impacted by broader market jitters. It might be worth keeping an eye on the fundamentals, in case there's a good opportunity. On the bright side, long term shareholders have made money, with a gain of 1.2% per year over half a decade. If the fundamental data continues to indicate long term sustainable growth, the current sell-off could be an opportunity worth considering. Before forming an opinion on Walvax Biotechnology you might want to consider these 3 valuation metrics.

We will like Walvax Biotechnology 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 Chinese exchanges.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.
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.