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The last three months have been tough on Agenus Inc. (NASDAQ:AGEN) shareholders, who have seen the share price decline a rather worrying 37%. But at least the stock is up over the last three years. Arguably you'd have been better off buying an index fund, because the gain of 50% in three years isn't amazing.
Let's take a look at the underlying fundamentals over the longer term, and see if they've been consistent with shareholders returns.
While Agenus made a small profit, in the last year, we think that the market is probably more focussed on the top line growth at the moment. Generally speaking, we'd consider a stock like this alongside loss-making companies, simply because the quantum of the profit is so low. It would be hard to believe in a more profitable future without growing revenues.
Agenus' revenue trended up 30% each year over three years. That's much better than most loss-making companies. While long-term shareholders have made money, the 14% per year gain over three years isn't that great given the rising market. Generally, we'd expect a stronger share price, given the impressive revenue growth. It could be that the stock was previously over-priced, or its losses might worry the market. But you might want to take a closer look at this one.
The graphic below depicts how earnings and revenue have changed over time (unveil the exact values by clicking on the image).
We know that Agenus has improved its bottom line lately, but what does the future have in store? This free report showing analyst forecasts should help you form a view on Agenus
A Different Perspective
Agenus shareholders are up 5.6% for the year. But that return falls short of the market. But at least that's still a gain! Over five years the TSR has been a reduction of 2% per year, over five years. So this might be a sign the business has turned its fortunes around. 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. For instance, we've identified 4 warning signs for Agenus (1 doesn't sit too well with us) that you should be aware of.
We will like Agenus better if we see some big insider buys. While we wait, check out this free list of growing companies with considerable, recent, insider 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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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.