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The past three-year earnings decline for Scienjoy Holding (NASDAQ:SJ) likely explains shareholders long-term losses

·2 min read

It is a pleasure to report that the Scienjoy Holding Corporation (NASDAQ:SJ) is up 50% in the last quarter. Meanwhile over the last three years the stock has dropped hard. Indeed, the share price is down a tragic 55% in the last three years. So it's good to see it climbing back up. Perhaps the company has turned over a new leaf.

While the stock has risen 34% in the past week but long term shareholders are still in the red, let's see what the fundamentals can tell us.

View our latest analysis for Scienjoy Holding

To quote Buffett, 'Ships will sail around the world but the Flat Earth Society will flourish. There will continue to be wide discrepancies between price and value in the marketplace...' 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 three years that the share price fell, Scienjoy Holding's earnings per share (EPS) dropped by 84% each year. This fall in the EPS is worse than the 24% compound annual share price fall. This suggests that the market retains some optimism around long term earnings stability, despite past EPS declines.

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

earnings-per-share-growth
earnings-per-share-growth

Dive deeper into Scienjoy Holding's key metrics by checking this interactive graph of Scienjoy Holding's earnings, revenue and cash flow.

A Different Perspective

Pleasingly, Scienjoy Holding's total shareholder return last year was 7.1%. That certainly beats the loss of about 16% per year over three years. We're generally cautious about putting too much weigh on shorter term data, but the recent improvement is definitely a positive. I find it very interesting to look at share price over the long term as a proxy for business performance. But to truly gain insight, we need to consider other information, too. Even so, be aware that Scienjoy Holding is showing 3 warning signs in our investment analysis , you should know about...

For those who like to find winning investments this free list of growing companies with recent insider purchasing, could be just the ticket.

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

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