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Strong week for F-star Therapeutics (NASDAQ:FSTX) shareholders doesn't alleviate pain of one-year loss

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F-star Therapeutics, Inc. (NASDAQ:FSTX) shareholders should be happy to see the share price up 24% in the last week. But that's not enough to compensate for the decline over the last twelve months. Like a receding glacier in a warming world, the share price has melted 67% in that period. It's not that amazing to see a bounce after a drop like that. You could argue that the sell-off was too severe.

While the stock has risen 24% in the past week but long term shareholders are still in the red, let's see what the fundamentals can tell us.

See our latest analysis for F-star Therapeutics

F-star Therapeutics isn't currently profitable, so most analysts would look to revenue growth to get an idea of how fast the underlying business is growing. Shareholders of unprofitable companies usually expect strong revenue growth. Some companies are willing to postpone profitability to grow revenue faster, but in that case one does expect good top-line growth.

F-star Therapeutics grew its revenue by 88% over the last year. That's a strong result which is better than most other loss making companies. Meanwhile, the share price slid 67%. Typically a growth stock like this will be volatile, with some shareholders concerned about the red ink on the bottom line (that is, the losses). Generally speaking investors would consider a stock like this less risky once it turns a profit. But when do you think that will happen?

You can see below how earnings and revenue have changed over time (discover the exact values by clicking on the image).

earnings-and-revenue-growth
earnings-and-revenue-growth

If you are thinking of buying or selling F-star Therapeutics stock, you should check out this FREE detailed report on its balance sheet.

A Different Perspective

While F-star Therapeutics shareholders are down 67% for the year, the market itself is up 6.0%. 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. The share price decline has continued throughout the most recent three months, down 29%, suggesting an absence of enthusiasm from investors. Basically, most investors should be wary of buying into a poor-performing stock, unless the business itself has clearly improved. 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 5 warning signs for F-star Therapeutics (2 are concerning) that you should be aware of.

Of course F-star Therapeutics may not be the best stock to buy. So you may wish to see this free collection of growth stocks.

Please note, the market returns quoted in this article reflect the market weighted average returns of stocks that currently trade on US exchanges.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.

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.