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The GT Steel Construction Group (HKG:8402) Share Price Is Up 46% And Shareholders Are Holding On

The simplest way to invest in stocks is to buy exchange traded funds. But you can significantly boost your returns by picking above-average stocks. To wit, the GT Steel Construction Group Limited (HKG:8402) share price is 46% higher than it was a year ago, much better than the market return of around -0.8% (not including dividends) in the same period. That's a solid performance by our standards! We'll need to follow GT Steel Construction Group for a while to get a better sense of its share price trend, since it hasn't been listed for particularly long.

See our latest analysis for GT Steel Construction Group

To paraphrase Benjamin Graham: Over the short term the market is a voting machine, but over the long term it's a weighing machine. 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 last year, GT Steel Construction Group actually saw its earnings per share drop 15%.

This means it's unlikely the market is judging the company based on earnings growth. Indeed, when EPS is declining but the share price is up, it often means the market is considering other factors.

Revenue was pretty flat year on year, but maybe a closer look at the data can explain the market optimism.

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

SEHK:8402 Income Statement, December 12th 2019
SEHK:8402 Income Statement, December 12th 2019

This free interactive report on GT Steel Construction Group's balance sheet strength is a great place to start, if you want to investigate the stock further.

A Different Perspective

GT Steel Construction Group boasts a total shareholder return of 46% for the last year. That's better than the more recent three month gain of 2.4%, implying that share price has plateaued recently. Having said that, we doubt shareholders would be concerned. It seems the market is simply waiting on more information, because if the business delivers so will the share price (eventually). Is GT Steel Construction Group cheap compared to other companies? These 3 valuation measures might help you decide.

Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of companies we expect will grow earnings.

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

If you spot an error that warrants correction, please contact the editor at editorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned.

We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Thank you for reading.

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