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CytomX Therapeutics, Inc. (NASDAQ:CTMX) shareholders should be happy to see the share price up 13% in the last month. But that's small comfort given the dismal price performance over the last year. Like a receding glacier in a warming world, the share price has melted 51% in that period. The share price recovery is not so impressive when you consider the fall. Of course, it could be that the fall was overdone.
CytomX Therapeutics isn't a profitable company, so it is unlikely we'll see a strong correlation between its share price and its earnings per share (EPS). Arguably revenue is our next best option. Shareholders of unprofitable companies usually expect strong revenue growth. That's because it's hard to be confident a company will be sustainable if revenue growth is negligible, and it never makes a profit.
CytomX Therapeutics grew its revenue by 0.9% over the last year. That's not a very high growth rate considering it doesn't make profits. Without profits, and with revenue growth sluggish, you get a 51% loss for shareholders, over the year. We'd want to see evidence that future revenue growth will be stronger before getting too interested. Of course, the market can be too impatient at times. Why not take a closer look at this one so you're ready to pounce if growth does accelerate.
You can see below how earnings and revenue have changed over time (discover the exact values by clicking on the image).
CytomX Therapeutics is a well known stock, with plenty of analyst coverage, suggesting some visibility into future growth. You can see what analysts are predicting for CytomX Therapeutics in this interactive graph of future profit estimates.
A Different Perspective
Over the last year, CytomX Therapeutics shareholders took a loss of 51%. In contrast the market gained about 7.7%. Of course the long term matters more than the short term, and even great stocks will sometimes have a poor year. Investors are up over three years, booking 2.7% per year, much better than the more recent returns. Sometimes when a good quality long term winner has a weak period, it's turns out to be an opportunity, but you really need to be sure that the quality is there. Most investors take the time to check the data on insider transactions. You can click here to see if insiders have been buying or selling.
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 US exchanges.
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If you spot an error that warrants correction, please contact the editor at firstname.lastname@example.org. 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.