Yahoo Finance Investors in Exscientia (NASDAQ:EXAI) from a year ago are still down 70%, even after 12% gain this past week
Exscientia plc (NASDAQ:EXAI) shareholders should be happy to see the share price up 12% 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 70% in that period. The share price recovery is not so impressive when you consider the fall. Arguably, the fall was overdone.
While the stock has risen 12% in the past week but long term shareholders are still in the red, let's see what the fundamentals can tell us.
View our latest analysis for Exscientia
Exscientia 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. 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.
Exscientia grew its revenue by 242% over the last year. That's well above most other pre-profit companies. Meanwhile, the share price slid 70%. This could mean hype has come out of the stock because the bottom line is concerning investors. Generally speaking investors would consider a stock like this less risky once it turns a profit. But when do you think that will happen?
The image below shows how earnings and revenue have tracked over time (if you click on the image you can see greater detail).
This free interactive report on Exscientia's balance sheet strength is a great place to start, if you want to investigate the stock further.
A Different Perspective
Exscientia shareholders are down 70% for the year, even worse than the market loss of 22%. That's disappointing, but it's worth keeping in mind that the market-wide selling wouldn't have helped. With the stock down 27% over the last three months, the market doesn't seem to believe that the company has solved all its problems. Basically, most investors should be wary of buying into a poor-performing stock, unless the business itself has clearly improved. It's always interesting to track share price performance over the longer term. But to understand Exscientia better, we need to consider many other factors. Like risks, for instance. Every company has them, and we've spotted 3 warning signs for Exscientia (of which 1 shouldn't be ignored!) you should know about.
But note: Exscientia may not be the best stock to buy. So take a peek at this free list of interesting companies with past earnings growth (and further growth forecast).
Please note, the market returns quoted in this article reflect the market weighted average returns of stocks that currently trade on US exchanges.
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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.
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