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If you want to compound wealth in the stock market, you can do so by buying an index fund. But one can do better than that by picking better than average stocks (as part of a diversified portfolio). For example, the IDEAYA Biosciences, Inc. (NASDAQ:IDYA) share price is up 99% in the last 1 year, clearly besting the market return of around 34% (not including dividends). If it can keep that out-performance up over the long term, investors will do very well! We'll need to follow IDEAYA Biosciences for a while to get a better sense of its share price trend, since it hasn't been listed for particularly long.
Let's take a look at the underlying fundamentals over the longer term, and see if they've been consistent with shareholders returns.
Because IDEAYA Biosciences 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. That's because fast revenue growth can be easily extrapolated to forecast profits, often of considerable size.
You can see below how earnings and revenue have changed over time (discover the exact values by clicking on the image).
If you are thinking of buying or selling IDEAYA Biosciences stock, you should check out this FREE detailed report on its balance sheet.
A Different Perspective
It's nice to see that IDEAYA Biosciences shareholders have gained 99% over the last year. The more recent returns haven't been as impressive as the longer term returns, coming in at just 18%. Having said that, we doubt shareholders would be concerned. It seems the market is simply waiting on more information, because if the business delivers so will the share price (eventually). 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. Take risks, for example - IDEAYA Biosciences has 4 warning signs (and 1 which is significant) we think you should know about.
We will like IDEAYA Biosciences 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.
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.
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