Does Ping An Healthcare and Technology's (HKG:1833) Share Price Gain of 60% Match Its Business Performance?

Simply Wall St

The simplest way to invest in stocks is to buy exchange traded funds. But you can significantly boost your returns by picking above-average stocks. For example, the Ping An Healthcare and Technology Company Limited (HKG:1833) share price is up 60% in the last year, clearly besting the market return of around -20% (not including dividends). If it can keep that out-performance up over the long term, investors will do very well! Note that businesses generally develop over the long term, so the returns over the last year might not reflect a long term trend.

See our latest analysis for Ping An Healthcare and Technology

Given that Ping An Healthcare and Technology 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. 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 year Ping An Healthcare and Technology saw its revenue grow by 52%. That's well above most other pre-profit companies. While the share price gain of 60% over twelve months is pretty tasty, you might argue it doesn't fully reflect the strong revenue growth. If that's the case, now might be the time to take a close look at Ping An Healthcare and Technology. Human beings have trouble conceptualizing (and valuing) exponential growth. Is that what we're seeing here?

You can see how earnings and revenue have changed over time in the image below (click on the chart to see the exact values).

SEHK:1833 Income Statement March 30th 2020

If you are thinking of buying or selling Ping An Healthcare and Technology stock, you should check out this FREE detailed report on its balance sheet.

A Different Perspective

It's nice to see that Ping An Healthcare and Technology shareholders have gained 60% over the last year. And the share price momentum remains respectable, with a gain of 24% in the last three months. This suggests the company is continuing to win over new investors. 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. Case in point: We've spotted 1 warning sign for Ping An Healthcare and Technology you should be aware of.

If you would prefer to check out another company -- one with potentially superior financials -- then do not miss this free list of companies that have proven they can 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 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.