Shareholders in Autolus Therapeutics (NASDAQ:AUTL) have lost 81%, as stock drops 22% this past week
As every investor would know, not every swing hits the sweet spot. But really big losses can really drag down an overall portfolio. So take a moment to sympathize with the long term shareholders of Autolus Therapeutics plc (NASDAQ:AUTL), who have seen the share price tank a massive 81% over a three year period. That might cause some serious doubts about the merits of the initial decision to buy the stock, to put it mildly. And more recent buyers are having a tough time too, with a drop of 58% in the last year. The falls have accelerated recently, with the share price down 33% in the last three months. This could be related to the recent financial results - you can catch up on the most recent data by reading our company report. We really feel for shareholders in this scenario. It's a good reminder of the importance of diversification, and it's worth keeping in mind there's more to life than money, anyway.
After losing 22% this past week, it's worth investigating the company's fundamentals to see what we can infer from past performance.
See our latest analysis for Autolus Therapeutics
With just US$2,715,000 worth of revenue in twelve months, we don't think the market considers Autolus Therapeutics to have proven its business plan. You have to wonder why venture capitalists aren't funding it. So it seems shareholders are too busy dreaming about the progress to come than dwelling on the current (lack of) revenue. For example, they may be hoping that Autolus Therapeutics comes up with a great new product, before it runs out of money.
Companies that lack both meaningful revenue and profits are usually considered high risk. There is almost always a chance they will need to raise more capital, and their progress - and share price - will dictate how dilutive that is to current holders. While some such companies do very well over the long term, others become hyped up by promoters before eventually falling back down to earth, and going bankrupt (or being recapitalized). Some Autolus Therapeutics investors have already had a taste of the bitterness stocks like this can leave in the mouth.
Autolus Therapeutics had cash in excess of all liabilities of just US$60m when it last reported (September 2022). So if it has not already moved to replenish reserves, we think the near-term chances of a capital raising event are pretty high. That probably explains why the share price is down 22% per year, over 3 years. The image below shows how Autolus Therapeutics' balance sheet has changed over time; if you want to see the precise values, simply click on the image.
In reality it's hard to have much certainty when valuing a business that has neither revenue or profit. Would it bother you if insiders were selling the stock? It would bother me, that's for sure. You can click here to see if there are insiders selling.
A Different Perspective
Autolus Therapeutics shareholders are down 58% for the year, falling short of the market return. The market shed around 25%, no doubt weighing on the stock price. The three-year loss of 22% per year isn't as bad as the last twelve months, suggesting that the company has not been able to convince the market it has solved its problems. Although Baron Rothschild famously said to "buy when there's blood in the streets, even if the blood is your own", he also focusses on high quality stocks with solid prospects. It's always interesting to track share price performance over the longer term. But to understand Autolus Therapeutics better, we need to consider many other factors. For instance, we've identified 5 warning signs for Autolus Therapeutics (1 can't be ignored) that you should be aware of.
We will like Autolus Therapeutics 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.
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