Investing in stocks comes with the risk that the share price will fall. Unfortunately, shareholders of Ming Yang Smart Energy Group Limited (SHSE:601615) have suffered share price declines over the last year. The share price is down a hefty 58% in that time. We note that it has not been easy for shareholders over three years, either; the share price is down 45% in that time. Furthermore, it's down 22% in about a quarter. That's not much fun for holders.

Since Ming Yang Smart Energy Group has shed CN¥829m from its value in the past 7 days, let's see if the longer term decline has been driven by the business' economics.

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 flawed but reasonable way to assess how sentiment around a company has changed is to compare the earnings per share (EPS) with the share price.

Unfortunately Ming Yang Smart Energy Group reported an EPS drop of 75% for the last year. The share price fall of 58% isn't as bad as the reduction in earnings per share. It may have been that the weak EPS was not as bad as some had feared.

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

Dive deeper into Ming Yang Smart Energy Group's key metrics by checking this interactive graph of Ming Yang Smart Energy Group's earnings, revenue and cash flow.

A Different Perspective

We regret to report that Ming Yang Smart Energy Group shareholders are down 57% for the year (even including dividends). Unfortunately, that's worse than the broader market decline of 15%. 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. Unfortunately, last year's performance may indicate unresolved challenges, given that it was worse than the annualised loss of 5% over the last half decade. 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 Ming Yang Smart Energy Group better, we need to consider many other factors. To that end, you should learn about the 3 warning signs we've spotted with Ming Yang Smart Energy Group (including 1 which is a bit concerning) .

If you like to buy stocks alongside management, then you might just love this free list of companies. (Hint: insiders have been buying them).

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