No-one enjoys it when they lose money on a stock. But no-one can make money on every call, especially in a declining market. The Chen Xing Development Holdings Limited (HKG:2286) is down 17% over three years, but the total shareholder return is 6.0% once you include the dividend. That's better than the market which declined 1.6% over the last three years. In the last ninety days we've seen the share price slide 20%. Of course, this share price action may well have been influenced by the 9.9% decline in the broader market, throughout the period.

Check out our latest analysis for Chen Xing Development Holdings

While markets are a powerful pricing mechanism, share prices reflect investor sentiment, not just underlying business performance. 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, Chen Xing Development Holdings's earnings per share (EPS) dropped by 16% each year. This fall in the EPS is worse than the 6.2% compound annual share price fall. This suggests that the market retains some optimism around long term earnings stability, despite past EPS declines.

The graphic below depicts how EPS has 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. It might be well worthwhile taking a look at our free report on Chen Xing Development Holdings's earnings, revenue and cash flow.

What about the Total Shareholder Return (TSR)?

We'd be remiss not to mention the difference between Chen Xing Development Holdings's total shareholder return (TSR) and its share price return. Arguably the TSR is a more complete return calculation because it accounts for the value of dividends (as if they were reinvested), along with the hypothetical value of any discounted capital that have been offered to shareholders. Chen Xing Development Holdings's TSR of 6.0% for the 3 years exceeded its share price return, because it has paid dividends.

A Different Perspective

We're pleased to report that Chen Xing Development Holdings rewarded shareholders with a total shareholder return of 9.0% over the last year. So this year's TSR was actually better than the three-year TSR (annualized) of 1.9%. Given the track record of solid returns over varying time frames, it might be worth putting Chen Xing Development Holdings on your watchlist. 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. To that end, you should learn about the 6 warning signs we've spotted with Chen Xing Development Holdings (including 3 which is can't be ignored) .

If you are like me, then you will not want to miss this free list of growing companies that insiders are 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.

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