If You Had Bought China Properties Investment Holdings (HKG:736) Stock Five Years Ago, You'd Be Sitting On A 98% Loss, Today
Long term investing is the way to go, but that doesn't mean you should hold every stock forever. We really hate to see fellow investors lose their hard-earned money. Imagine if you held China Properties Investment Holdings Limited (HKG:736) for half a decade as the share price tanked 98%. And it's not just long term holders hurting, because the stock is down 39% in the last year. Shareholders have had an even rougher run lately, with the share price down 11% in the last 90 days. Of course, this share price action may well have been influenced by the 15% decline in the broader market, throughout the period.
While a drop like that is definitely a body blow, money isn't as important as health and happiness.
See our latest analysis for China Properties Investment Holdings
Given that China Properties Investment Holdings didn't make a profit in the last twelve months, we'll focus on revenue growth to form a quick view of its business development. Shareholders of unprofitable companies usually expect strong revenue growth. That's because fast revenue growth can be easily extrapolated to forecast profits, often of considerable size.
Over five years, China Properties Investment Holdings grew its revenue at 35% per year. That's well above most other pre-profit companies. So on the face of it we're really surprised to see the share price has averaged a fall of 56% each year, in the same time period. You'd have to assume the market is worried that profits won't come soon enough. While there might be an opportunity here, you'd want to take a close look at the balance sheet strength.
The company's revenue and earnings (over time) are depicted in the image below (click to see the exact numbers).
This free interactive report on China Properties Investment Holdings's balance sheet strength is a great place to start, if you want to investigate the stock further.
A Different Perspective
We regret to report that China Properties Investment Holdings shareholders are down 39% for the year. 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. However, the loss over the last year isn't as bad as the 55% per annum loss investors have suffered over the last half decade. We'd need to see some sustained improvements in the key metrics before we could muster much enthusiasm. 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. Even so, be aware that China Properties Investment Holdings is showing 5 warning signs in our investment analysis , and 1 of those doesn't sit too well with us...
We will like China Properties Investment Holdings 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 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.
