Yahoo Finance Investors one-year losses grow to 71% as the stock sheds US$149m this past week
The art and science of stock market investing requires a tolerance for losing money on some of the shares you buy. But it should be a priority to avoid stomach churning catastrophes, wherever possible. So spare a thought for the long term shareholders of Twist Bioscience Corporation (NASDAQ:TWST); the share price is down a whopping 71% in the last twelve months. That'd be enough to make even the strongest stomachs churn. On the bright side, the stock is actually up 27% in the last three years. Shareholders have had an even rougher run lately, with the share price down 55% in the last 90 days. This could be related to the recent financial results - you can catch up on the most recent data by reading our company report.
If the past week is anything to go by, investor sentiment for Twist Bioscience isn't positive, so let's see if there's a mismatch between fundamentals and the share price.
See our latest analysis for Twist Bioscience
Because Twist Bioscience 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. Generally speaking, companies without profits are expected to grow revenue every year, and at a good clip. As you can imagine, fast revenue growth, when maintained, often leads to fast profit growth.
Twist Bioscience grew its revenue by 44% over the last year. We think that is pretty nice growth. However, it seems like the market wanted more, since the share price is down 71%. It could be that the losses are too much for investors to handle without losing their nerve. It seems that the market has concerns about the future, because that share price action does not seem to reflect the revenue growth at all.
The image below shows how earnings and revenue have tracked over time (if you click on the image you can see greater detail).
We're pleased to report that the CEO is remunerated more modestly than most CEOs at similarly capitalized companies. But while CEO remuneration is always worth checking, the really important question is whether the company can grow earnings going forward. You can see what analysts are predicting for Twist Bioscience in this interactive graph of future profit estimates.
A Different Perspective
Twist Bioscience shareholders are down 71% for the year, falling short of the market return. Meanwhile, the broader market slid about 9.8%, likely weighing on the stock. Investors are up over three years, booking 8% per year, much better than the more recent returns. The recent sell-off could be an opportunity if the business remains sound, so it may be worth checking the fundamental data for signs of a long-term growth trend. 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. To that end, you should learn about the 4 warning signs we've spotted with Twist Bioscience (including 1 which is concerning) .
If you are like me, then you will not want to miss this free list of growing companies that insiders are buying.
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.
