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Intra-Cellular Therapies (NASDAQ:ITCI) Shareholders Booked A 99% Gain In The Last Year

Simply Wall St

The Intra-Cellular Therapies, Inc. (NASDAQ:ITCI) share price is down a rather concerning 33% in the last month. But that doesn't change the reality that over twelve months the stock has done really well. In that time we've seen the stock easily surpass the market return, with a gain of 99%.

View our latest analysis for Intra-Cellular Therapies

Intra-Cellular Therapies recorded just US$5,055 in revenue over the last twelve months, which isn't really enough for us to consider it to have a proven product. So it seems shareholders are too busy dreaming about the progress to come than dwelling on the current (lack of) revenue. It seems likely some shareholders believe that Intra-Cellular Therapies will significantly advance the business plan before too long.

Companies that lack both meaningful revenue and profits are usually considered high risk. There is usually a significant chance that they will need more money for business development, putting them at the mercy of capital markets. So the share price itself impacts the value of the shares (as it determines the cost of capital). While some companies like this go on to deliver on their plan, making good money for shareholders, many end in painful losses and eventual de-listing. Of course, if you time it right, high risk investments like this can really pay off, as Intra-Cellular Therapies investors might know.

Intra-Cellular Therapies had cash in excess of all liabilities of US$202m when it last reported (September 2019). That's not too bad but management may have to think about raising capital or taking on debt, unless the company is close to breaking even. With the share price up 100% in the last year , the market is seems hopeful about the potential, despite the cash burn. You can see in the image below, how Intra-Cellular Therapies's cash levels have changed over time (click to see the values). You can see in the image below, how Intra-Cellular Therapies's cash levels have changed over time (click to see the values).

NasdaqGS:ITCI Historical Debt, January 27th 2020
NasdaqGS:ITCI Historical Debt, January 27th 2020

Of course, the truth is that it is hard to value companies without much revenue or profit. However you can take a look at whether insiders have been buying up shares. It's usually a positive if they have, as it may indicate they see value in the stock. You can click here to see if there are insiders buying.

A Different Perspective

It's good to see that Intra-Cellular Therapies has rewarded shareholders with a total shareholder return of 99% in the last twelve months. Since the one-year TSR is better than the five-year TSR (the latter coming in at 3.4% 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. While it is well worth considering the different impacts that market conditions can have on the share price, there are other factors that are even more important. To that end, you should learn about the 4 warning signs we've spotted with Intra-Cellular Therapies (including 2 which is make us uncomfortable) .

There are plenty of other companies that have insiders buying up shares. You probably do 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.

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.