Want To Invest In Editas Medicine Inc (NASDAQ:EDIT)? Here’s How It Performed Lately
Analyzing Editas Medicine Inc’s (NASDAQ:EDIT) track record of past performance is a valuable exercise for investors. It enables us to reflect on whether or not the company has met expectations, which is a powerful signal for future performance. Today I will assess EDIT’s recent performance announced on 30 September 2017 and compare these figures to its long-term trend and industry movements. Check out our latest analysis for Editas Medicine
Commentary On EDIT’s Past Performance
I use the ‘latest twelve-month’ data, which annualizes the most recent half-year data, or in some cases, the latest annual report is already the most recent financial year data. This allows me to analyze various companies on a similar basis, using new information. For Editas Medicine, its most recent earnings is -$123.5M, which, in comparison to the previous year’s figure, has become more negative. Given that these values are fairly short-term, I’ve calculated an annualized five-year figure for Editas Medicine’s net income, which stands at -$69.2M. This doesn’t look much better, since earnings seem to have consistently been getting more and more negative over time.
We can further evaluate Editas Medicine’s loss by looking at what’s going on in the industry as well as within the company. Firstly, I want to quickly look into the line items. Revenue growth over the past few years has grown by 87.49%, implying that Editas Medicine is in a high-growth period with expenses shooting ahead of elevated top-line growth rates, leading to yearly losses. Inspecting growth from a sector-level, the US biotechnology industry has been growing its average earnings by double-digit 11.07% in the prior twelve months, and 20.18% over the past couple of years. This means that whatever uplift the industry is deriving benefit from, Editas Medicine has not been able to realize the gains unlike its average peer.
What does this mean?
Though Editas Medicine’s past data is helpful, it is only one aspect of my investment thesis. With companies that are currently loss-making, it is always hard to forecast what will happen in the future and when. The most insightful step is to assess company-specific issues Editas Medicine may be facing and whether management guidance has consistently been met in the past. You should continue to research Editas Medicine to get a better picture of the stock by looking at:
1. Future Outlook: What are well-informed industry analysts predicting for EDIT’s future growth? Take a look at our free research report of analyst consensus for EDIT’s outlook.
2. Financial Health: Is EDIT’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.
3. 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 last twelve months, which refer to the 12-month period ending on the last date of the month the financial statement is dated. 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.
