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Did Coherus BioSciences's (NASDAQ:CHRS) Share Price Deserve to Gain 29%?

Simply Wall St

If you want to compound wealth in the stock market, you can do so by buying an index fund. But you can significantly boost your returns by picking above-average stocks. For example, the Coherus BioSciences, Inc. (NASDAQ:CHRS) share price is up 29% in the last year, clearly besting than the market return of around 2.6% (not including dividends). That's a solid performance by our standards! However, the longer term returns haven't been so impressive, with the stock up just 8.3% in the last three years.

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View our latest analysis for Coherus BioSciences

Given that Coherus BioSciences 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. As you can imagine, fast revenue growth, when maintained, often leads to fast profit growth.

Coherus BioSciences grew its revenue by 2559% last year. That's stonking growth even when compared to other loss-making stocks. The solid 29% share price gain goes down pretty well, but it's not necessarily as good as you might expect given the top notch revenue growth. So quite frankly it could be a good time to investigate Coherus BioSciences in some detail. Human beings have trouble conceptualizing (and valuing) exponential growth. Is that what we're seeing here?

The chart below shows how revenue and earnings have changed with time, (if you click on the chart you can see the actual values).

NasdaqGM:CHRS Income Statement, May 22nd 2019

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

A Different Perspective

It's nice to see that Coherus BioSciences shareholders have gained 29% (in total) over the last year. So this year's TSR was actually better than the three-year TSR (annualized) of 2.7%. Given the track record of solid returns over varying time frames, it might be worth putting Coherus BioSciences on your watchlist. Before spending more time on Coherus BioSciences it might be wise to click here to see if insiders have been buying or selling shares.

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 US exchanges.

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.

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. Thank you for reading.