Some stocks are best avoided. We really hate to see fellow investors lose their hard-earned money. Imagine if you held Sino Energy International Holdings Group Limited (HKG:1096) for half a decade as the share price tanked 95%. And it's not just long term holders hurting, because the stock is down 69% in the last year. But it's up 8.9% in the last week.
While a drop like that is definitely a body blow, money isn't as important as health and happiness.
Because Sino Energy International Holdings Group made a loss in the last twelve months, we think the market is probably more focussed on revenue and revenue growth, at least for now. Generally speaking, companies without profits are expected to grow revenue every year, and at a good clip. Some companies are willing to postpone profitability to grow revenue faster, but in that case one does expect good top-line growth.
In the last five years Sino Energy International Holdings Group saw its revenue shrink by 38% per year. That puts it in an unattractive cohort, to put it mildly. So it's not that strange that the share price dropped 45% per year in that period. We don't think this is a particularly promising picture. Of course, the poor performance could mean the market has been too severe selling down. That can happen.
The graphic below depicts how earnings and revenue have changed over time (unveil the exact values by clicking on the image).
We're pleased to report that the CEO is remunerated more modestly than most CEOs at similarly capitalized companies. It's always worth keeping an eye on CEO pay, but a more important question is whether the company will grow earnings throughout the years. Dive deeper into the earnings by checking this interactive graph of Sino Energy International Holdings Group's earnings, revenue and cash flow.
A Different Perspective
While the broader market lost about 3.1% in the twelve months, Sino Energy International Holdings Group shareholders did even worse, losing 69%. 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. Regrettably, last year's performance caps off a bad run, with the shareholders facing a total loss of 45% per year over five years. Generally speaking long term share price weakness can be a bad sign, though contrarian investors might want to research the stock in hope of a turnaround. It's always interesting to track share price performance over the longer term. But to understand Sino Energy International Holdings Group better, we need to consider many other factors. To that end, you should learn about the 5 warning signs we've spotted with Sino Energy International Holdings Group (including 1 which is can't be ignored) .
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 firstname.lastname@example.org. 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.
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