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Silk Road Medical, Inc (NASDAQ:SILK) shareholders should be happy to see the share price up 21% in the last quarter. But that doesn't change the fact that the returns over the last year have been less than pleasing. In fact the stock is down 15% in the last year, well below the market return.
The recent uptick of 3.8% could be a positive sign of things to come, so let's take a lot at historical fundamentals.
Silk Road Medical isn't currently profitable, so most analysts would look to revenue growth to get an idea of how fast the underlying business is growing. When a company doesn't make profits, we'd generally expect to see good 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.
Silk Road Medical grew its revenue by 29% over the last year. We think that is pretty nice growth. Meanwhile, the share price is down 15% over twelve months, which is disappointing given the progress made. This implies the market was expecting better growth. However, that's in the past now, and it's the future that matters most.
You can see how earnings and revenue have changed over time in the image below (click on the chart to see the exact values).
We're pleased to report that the CEO is remunerated more modestly than most CEOs at similarly capitalized companies. But while CEO remuneration is always worth checking, the really important question is whether the company can grow earnings going forward. So it makes a lot of sense to check out what analysts think Silk Road Medical will earn in the future (free profit forecasts).
A Different Perspective
Given that the market gained 27% in the last year, Silk Road Medical shareholders might be miffed that they lost 15%. While the aim is to do better than that, it's worth recalling that even great long-term investments sometimes underperform for a year or more. Putting aside the last twelve months, it's good to see the share price has rebounded by 21%, in the last ninety days. Let's just hope this isn't the widely-feared 'dead cat bounce' (which would indicate further declines to come). It's always interesting to track share price performance over the longer term. But to understand Silk Road Medical better, we need to consider many other factors. For example, we've discovered 1 warning sign for Silk Road Medical that you should be aware of before investing here.
If you would prefer to check out another company -- one with potentially superior financials -- then do not miss this free list of companies that have proven they can grow earnings.
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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