Did Business Growth Power Inventiva's (EPA:IVA) Share Price Gain of 251%?

Inventiva S.A. (EPA:IVA) shareholders might be concerned after seeing the share price drop 22% in the last month. On the other hand, over the last twelve months the stock has delivered rather impressive returns. During that period, the share price soared a full 251%. So we think most shareholders won't be too upset about the recent fall. Only time will tell if there is still too much optimism currently reflected in the share price.

Check out our latest analysis for Inventiva

Inventiva isn't currently profitable, so most analysts would look to revenue growth to get an idea of how fast the underlying business is growing. When a company doesn't make profits, we'd generally expect to see good revenue growth. Some companies are willing to postpone profitability to grow revenue faster, but in that case one does expect good top-line growth.

Inventiva actually shrunk its revenue over the last year, with a reduction of 53%. So we would not have expected the share price to rise 251%. It just goes to show the market doesn't always pay attention to the reported numbers. It's quite likely the revenue fall was already priced in, anyway.

The company's revenue and earnings (over time) are depicted in the image below (click to see the exact numbers).

Balance sheet strength is crucial. It might be well worthwhile taking a look at our free report on how its financial position has changed over time.

A Different Perspective

It's nice to see that Inventiva shareholders have gained 251% (in total) over the last year. That's better than the annualized TSR of 11% over the last three years. These improved returns may hint at some real business momentum, implying that now could be a great time to delve deeper. It's always interesting to track share price performance over the longer term. But to understand Inventiva better, we need to consider many other factors. For example, we've discovered 3 warning signs for Inventiva that you should be aware of before investing here.

If you would prefer to check out another company -- one with potentially superior financials -- then do not miss this free list of companies that have proven they can grow earnings.

Please note, the market returns quoted in this article reflect the market weighted average returns of stocks that currently trade on FR 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 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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