Affimed NV (NASDAQ: AFMD) shareholders may be worried after seeing the share price fall by 11% in the last month. But in three years, the return has been great. In fact, the share price has risen by as much as 177% compared to three years ago. For some, the recent retreat of the stock price will not be surprising after such a good run. Only time will tell if there is still too much optimism currently reflected in the stock price.
Because Affimed lost the last twelve months, we believe the market is likely to be more focused on revenue and revenue growth, at least for now. Shareholders in unprofitable companies usually expect strong revenue growth. This is because rapid revenue growth can easily be extrapolated to expected profits, often of significant size.
For the past 3 years, Affimed has experienced 49% revenue per year. It is much better than most loss-making companies. Meanwhile, the share price development has been quite solid at 40% composition over three years. But it appears that the market is aware of strong revenue growth. Nevertheless, we would say Affimed is still worth exploring – successful companies can often continue to grow for long periods of time.
You can see below how earnings and revenue have changed over time (find the exact values by clicking on the image).
Take a closer look at Affimed’s financial health with this for free report on the balance sheet.
It is good to see that Affimed has rewarded shareholders with a total shareholder return of 141% over the last twelve months. This gain is better than the annual TSR over five years, which is 13%. Therefore, it seems that the mood around the company has been positive lately. Given that the stock price momentum remains strong, it may be worth taking a closer look at the stock so you do not miss an opportunity. I find it very interesting to look at the stock price in the long run as a power of attorney for business results. But to really gain insight, we also need to consider other information. Take risks, for example – Affimed has 3 warning signs (and 1 who does not sit too well with us) we think you need to know about.
Of course Affimed may not be the best stock to buy. So you might want to see this for free collection of growth stocks.
Note that the market return quoted in this article reflects the market-weighted average return on equities currently traded on U.S. stock exchanges.
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This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any shares and does not take into account your goals or your financial situation. We strive to provide you with long-term focused analysis driven by basic data. Please note that our analysis may not include the latest price sensitive company announcements or qualitative material. Simply Wall St has no position in the mentioned stocks.
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