360 Security Technology’s Market Cap Soars by CN¥2.9 Billion in Just 7 Days—But Long-Term Investors Face 58% Loss!

It’s encouraging to see that 360 Security Technology Inc. (SHSE:601360) share price has risen by 16% over the last three months. However, this recent boost doesn’t erase the struggles of the past five years, where shareholders have faced a steep decline of 59%. Therefore, it’s wise to be cautious about the short-term gains. Still, there is hope that this upward trend could continue.

The last five years have been challenging for investors in 360 Security Technology, but recent signs indicate a potential turnaround. Let’s dig into the fundamentals to understand what has led to these disappointing results.

Because 360 Security Technology didn’t turn a profit in the last twelve months, we’ll look at revenue growth to gauge its business health. When a company isn’t profitable, strong revenue growth can signal future potential profits.

Over the past five years, 360 Security Technology’s revenue has actually decreased by 9.5% annually. This trend has not been favorable, which is reflected in an annual drop of about 10% in the share price. Generally, we prefer to avoid stocks that are not profitable and are also losing revenue. This stock appears quite risky at first glance.

You can see how earnings and revenue have evolved over time in the chart below (click on the chart for specific details).

For those interested, there’s a free interactive report available that explores 360 Security Technology’s balance sheet and overall strength.

A Different Perspective

It’s worth noting that 360 Security Technology provided shareholders with a total return of 38% over the last year, including dividends. However, this recent performance sharply contrasts with the five-year annual loss of 10%. This inconsistency raises some eyebrows, but perhaps the company has turned a corner.

Tracking share price performance over time is insightful, but to fully understand 360 Security Technology, it’s important to consider various factors, including investment risks. We have identified two warning signs regarding this company—at least one of which you should take seriously—so it’s essential to factor them into your investment decision.

Note that the market returns mentioned reflect the average returns of stocks currently listed on Chinese exchanges.

This article is intended to provide a general overview. It is important to note that our commentary is based on historical data and analyst forecasts without any bias. Our articles are not financial advice and are not recommendations to buy or sell stocks, nor do they consider your personal financial situation. We strive to deliver long-term analysis based on fundamental data. Remember, our analysis may not include the latest price-sensitive company announcements or qualitative factors. Simply Wall St does not hold positions in any mentioned stocks.