Arrowhead Pharmaceuticals (NASDAQ:ARWR investor three-year losses grow to 69% as the stock sheds US$223m this past week

Investing in stocks inevitably means buying into some companies that perform poorly. Long term Arrowhead Pharmaceuticals, Inc. (NASDAQ:ARWR) shareholders know that all too well, since the share price is down considerably over three years. Unfortunately, they have held through a 69% decline in the share price in that time. The more recent news is of little comfort, with the share price down 38% in a year. Furthermore, it's down 33% in about a quarter. That's not much fun for holders.

With the stock having lost 7.5% in the past week, it's worth taking a look at business performance and seeing if there's any red flags.

Check out our latest analysis for Arrowhead Pharmaceuticals

Given that Arrowhead Pharmaceuticals 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. When a company doesn't make profits, we'd generally hope to see good revenue growth. As you can imagine, fast revenue growth, when maintained, often leads to fast profit growth.

In the last three years, Arrowhead Pharmaceuticals saw its revenue grow by 29% per year, compound. That's well above most other pre-profit companies. In contrast, the share price is down 19% compound, over three years - disappointing by most standards. It seems likely that the market is worried about the continual losses. When we see revenue growth, paired with a falling share price, we can't help wonder if there is an opportunity for those who are willing to dig deeper.

You can see how earnings and revenue have changed over time in the image below (click on the chart to see the exact values).

Arrowhead Pharmaceuticals is well known by investors, and plenty of clever analysts have tried to predict the future profit levels. If you are thinking of buying or selling Arrowhead Pharmaceuticals stock, you should check out this free report showing analyst consensus estimates for future profits.

A Different Perspective

Arrowhead Pharmaceuticals shareholders are down 38% for the year, but the market itself is up 24%. However, keep in mind that even the best stocks will sometimes underperform the market over a twelve month period. Longer term investors wouldn't be so upset, since they would have made 4%, each year, over five years. If the fundamental data continues to indicate long term sustainable growth, the current sell-off could be an opportunity worth considering. 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. Case in point: We've spotted 3 warning signs for Arrowhead Pharmaceuticals you should be aware of.

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 American 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.