It's been a soft week for Strong Petrochemical Holdings Limited (HKG:852) shares, which are down 13%. But looking back over the last year, the returns have actually been rather pleasing! Looking at the full year, the company has easily bested an index fund by gaining 91%.

Although Strong Petrochemical Holdings has shed HK$85m from its market cap this week, let's take a look at its longer term fundamental trends and see if they've driven returns.

See our latest analysis for Strong Petrochemical Holdings

Because Strong Petrochemical Holdings 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. Shareholders of unprofitable companies usually desire strong revenue growth. As you can imagine, fast revenue growth, when maintained, often leads to fast profit growth.

Strong Petrochemical Holdings grew its revenue by 79% last year. That's well above most other pre-profit companies. The solid 91% share price gain goes down pretty well, but it's not necessarily as good as you might expect given the top notch revenue growth. If that's the case, now might be the time to take a close look at Strong Petrochemical Holdings. 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).

This free interactive report on Strong Petrochemical Holdings' balance sheet strength is a great place to start, if you want to investigate the stock further.

A Different Perspective

It's good to see that Strong Petrochemical Holdings has rewarded shareholders with a total shareholder return of 91% in the last twelve months. There's no doubt those recent returns are much better than the TSR loss of 7% per year over five years. This makes us a little wary, but the business might have turned around its fortunes. It's always interesting to track share price performance over the longer term. But to understand Strong Petrochemical Holdings better, we need to consider many other factors. For example, we've discovered 2 warning signs for Strong Petrochemical Holdings (1 doesn't sit too well with us!) that you should be aware of before investing here.

Of course Strong Petrochemical Holdings may not be the best stock to buy. So you may wish to see this free collection of growth stocks.

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

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.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.