Yahoo Finance Did The Underlying Business Drive Bionano Genomics' (NASDAQ:BNGO) Lovely 997% Share Price Gain?
Bionano Genomics, Inc. (NASDAQ:BNGO) shareholders might be concerned after seeing the share price drop 14% in the last week. But that doesn't change the fact that the returns over the last year have been spectacular. Few could complain about the impressive 997% rise, throughout the period. Arguably, the recent fall is to be expected after such a strong rise. While winners often keep winning, it can pay to be cautious after a strong rise.
It really delights us to see such great share price performance for investors.
See our latest analysis for Bionano Genomics
Given that Bionano Genomics didn't make a profit in the last twelve months, we'll focus on revenue growth to form a quick view of its business development. Generally speaking, companies without profits are expected to grow revenue every year, and at a good clip. That's because it's hard to be confident a company will be sustainable if revenue growth is negligible, and it never makes a profit.
In the last year Bionano Genomics saw its revenue shrink by 36%. So it's very confusing to see that the share price gained a whopping 997%. It's pretty clear the market isn't basing its valuation on fundamental metrics like revenue. While this gain looks like speculative buying to us, sometimes speculation pays off.
The image below shows how earnings and revenue have tracked over time (if you click on the image you can see greater detail).
It's probably worth noting that the CEO is paid less than the median at similar sized companies. It's always worth keeping an eye on CEO pay, but a more important question is whether the company will grow earnings throughout the years. This free report showing analyst forecasts should help you form a view on Bionano Genomics
A Different Perspective
Bionano Genomics boasts a total shareholder return of 997% for the last year. And the share price momentum remains respectable, with a gain of 2,315% in the last three months. This suggests the company is continuing to win over new investors. I find it very interesting to look at share price over the long term as a proxy for business performance. But to truly gain insight, we need to consider other information, too. Even so, be aware that Bionano Genomics is showing 4 warning signs in our investment analysis , and 2 of those are a bit concerning...
If you like to buy stocks alongside management, then you might just love this free list of companies. (Hint: insiders have been buying them).
Please note, the market returns quoted in this article reflect the market weighted average returns of stocks that currently trade on US exchanges.
This article by Simply Wall St is general in nature. 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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