Examining how Chimerix Inc (NASDAQ:CMRX) is performing as a company requires looking at more than just a years’ earnings. Below, I will run you through a simple sense check to build perspective on how Chimerix is doing by comparing its most recent earnings with its historical trend, in addition to the performance of its biotechs industry peers. Check out our latest analysis for Chimerix
How Did CMRX’s Recent Performance Stack Up Against Its Past?
I use data from the most recent 12 months, which annualizes the latest 6-month earnings release, or some times, the latest annual report is already the most recent financial data. This method enables me to examine different companies on a similar basis, using the most relevant data points. For Chimerix, its most recent bottom-line (trailing twelve month) is -US$70.98M, which, in comparison to the previous year’s figure, has become less negative. Given that these figures may be fairly short-term, I have computed an annualized five-year value for Chimerix’s net income, which stands at -US$66.45M. This suggests that, Chimerix has historically performed better than recently, even though it seems like earnings are now heading back towards to right direction again.
We can further analyze Chimerix’s loss by looking at what the industry has been experiencing over the past few years. Each year, for the last five years Chimerix has seen an annual decline in revenue of -32.66%, on average. This adverse movement is a driver of the company’s inability to reach breakeven. Has the entire industry experienced this headwind? Scanning growth from a sector-level, the US biotechs industry has been growing its average earnings by double-digit 21.51% over the past twelve months, and 18.34% over the past five years. This shows that whatever tailwind the industry is profiting from, Chimerix has not been able to realize the gains unlike its industry peers.
What does this mean?
While past data is useful, it doesn’t tell the whole story. With companies that are currently loss-making, it is always difficult to forecast what will occur going forward, and when. The most insightful step is to examine company-specific issues Chimerix may be facing and whether management guidance has consistently been met in the past. I recommend you continue to research Chimerix to get a more holistic view of the stock by looking at:
- Future Outlook: What are well-informed industry analysts predicting for CMRX’s future growth? Take a look at our free research report of analyst consensus for CMRX’s outlook.
- Financial Health: Is CMRX’s operations financially sustainable? Balance sheets can be hard to analyze, which is why we’ve done it for you. Check out our financial health checks here.
- Other High-Performing Stocks: Are there other stocks that provide better prospects with proven track records? Explore our free list of these great stocks here.
NB: Figures in this article are calculated using data from the trailing twelve months from 31 December 2017. This may not be consistent with full year annual report figures.
To help readers see pass the short term volatility of the financial market, we aim to bring you a long-term focused research analysis purely driven by fundamental data. Note that our analysis does not factor in the latest price sensitive company announcements.
The author is an independent contributor and at the time of publication had no position in the stocks mentioned.