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Fate Therapeutics (NASDAQ:FATE) Shareholders Have Enjoyed A Whopping 682% Share Price Gain

Simply Wall St

Generally speaking, investors are inspired to be stock pickers by the potential to find the big winners. You won't get it right every time, but when you do, the returns can be truly splendid. For example, the Fate Therapeutics, Inc. (NASDAQ:FATE) share price is up a whopping 682% in the last three years, a handsome return for long term holders. On top of that, the share price is up 80% in about a quarter.

Anyone who held for that rewarding ride would probably be keen to talk about it.

Check out our latest analysis for Fate Therapeutics

Because Fate Therapeutics 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 expect strong revenue growth. As you can imagine, fast revenue growth, when maintained, often leads to fast profit growth.

Fate Therapeutics's revenue trended up 26% each year over three years. That's well above most pre-profit companies. And it's not just the revenue that is taking off. The share price is up 98% per year in that time. It's always tempting to take profits after a share price gain like that, but high-growth companies like Fate Therapeutics can sometimes sustain strong growth for many years. So we'd recommend you take a closer look at this one, or even put it on your watchlist.

The graphic below depicts how earnings and revenue have changed over time (unveil the exact values by clicking on the image).

NasdaqGM:FATE Income Statement, January 16th 2020

Fate Therapeutics is well known by investors, and plenty of clever analysts have tried to predict the future profit levels. You can see what analysts are predicting for Fate Therapeutics in this interactive graph of future profit estimates.

A Different Perspective

It's nice to see that Fate Therapeutics shareholders have received a total shareholder return of 48% over the last year. Since the one-year TSR is better than the five-year TSR (the latter coming in at 39% per year), it would seem that the stock's performance has improved in recent times. Given the share price momentum remains strong, it might be worth taking a closer look at the stock, lest you miss an opportunity. I find it very interesting to look at share price over the long term as a proxy for business performance. But to truly gain insight, we need to consider other information, too. Consider risks, for instance. Every company has them, and we've spotted 3 warning signs for Fate Therapeutics you should know about.

But note: Fate Therapeutics may not be the best stock to buy. So take a peek at this free list of interesting companies with past earnings growth (and further growth forecast).

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