Travere Therapeutics' (NASDAQ:TVTX) growing losses don't faze investors as the stock ascends 5.1% this past week
The main point of investing for the long term is to make money. But more than that, you probably want to see it rise more than the market average. But Travere Therapeutics, Inc. (NASDAQ:TVTX) has fallen short of that second goal, with a share price rise of 61% over five years, which is below the market return. Looking at the last year alone, the stock is up 14%.
Since the stock has added US$90m to its market cap in the past week alone, let's see if underlying performance has been driving long-term returns.
View our latest analysis for Travere Therapeutics
Because Travere Therapeutics 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. When a company doesn't make profits, we'd generally expect to see good revenue growth. Some companies are willing to postpone profitability to grow revenue faster, but in that case one does expect good top-line growth.
In the last 5 years Travere Therapeutics saw its revenue grow at 9.3% per year. That's a fairly respectable growth rate. The annual gain of 10% over five years is better than nothing, but falls short of the market. Arguably, that means, the market (previously) expected stronger growth from the company.
The image below shows how earnings and revenue have tracked over time (if you click on the image you can see greater detail).
Balance sheet strength is crucial. It might be well worthwhile taking a look at our free report on how its financial position has changed over time.
A Different Perspective
It's good to see that Travere Therapeutics has rewarded shareholders with a total shareholder return of 14% in the last twelve months. That gain is better than the annual TSR over five years, which is 10%. Therefore it seems like sentiment around the company has been positive lately. In the best case scenario, this may hint at some real business momentum, implying that now could be a great time to delve deeper. 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 2 warning signs for Travere Therapeutics that you should be aware of.
Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of companies we expect will 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.
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.
