Compass Therapeutics (CMPX): Evaluating Valuation After a 55% 1-Month Share Price Surge

Compass Therapeutics (CMPX) has seen a strong move in its shares lately, with returns climbing more than 55% over the past month. Investors are taking note as the stock continues to outperform the broader biotech sector.

See our latest analysis for Compass Therapeutics.

Compass Therapeutics’ impressive run is not just a short-term blip. The stock’s 1-month share price return of 55% follows an extraordinary 314% gain year-to-date, with momentum clearly building. Over the past year, total shareholder return reached 256%, reflecting investors’ increasing optimism around the company’s therapeutic pipeline and recent milestones.

If today’s momentum has you curious about what else is on the move in healthcare, this is a great time to discover See the full list for free.

With Compass Therapeutics’ rapid gains and a share price still trading well below analyst targets, the key question for investors now is whether the current rally leaves undiscovered value, or if the market is already anticipating the company’s next phase of growth.

Price-to-Book Ratio of 4.9x: Is it justified?

At a price-to-book ratio of 4.9x, Compass Therapeutics trades above the US Biotechs industry average of 2.8x. This premium raises the question of whether the company's rapid growth prospects and recent momentum can justify such a valuation.

The price-to-book ratio is a popular metric for biotechs and other asset-heavy sectors. It compares a company’s market value to its net assets on the balance sheet. A higher ratio can indicate expected growth, but it can also signal the market is pricing in strong future developments.

While Compass Therapeutics stands out for its pipeline progress and robust revenue forecasts, investors should recognize the market is currently paying a significant premium over industry peers. If sector trends shift or milestone achievements slow down, this elevated multiple may be tough to sustain in the long run.

Compared to other biotech companies, Compass’s price-to-book ratio stands well above the industry average. This highlights the market’s optimism. However, there is insufficient data to determine the fair ratio that the market could move toward.

See what the numbers say about this price — find out in our valuation breakdown.

Result: Price-to-Book Ratio of 4.9x (OVERVALUED)

However, risks remain if clinical trials face setbacks, or if Compass’s novel therapies struggle to gain regulatory approval. If investor confidence wanes, this could further increase the challenges.

Find out about the key risks to this Compass Therapeutics narrative.

Build Your Own Compass Therapeutics Narrative

If you’d like to dig deeper, you can review the data for yourself and quickly develop your own perspective in just a few minutes. Do it your way

A great starting point for your Compass Therapeutics research is our analysis highlighting 1 key reward and 3 important warning signs that could impact your investment decision.

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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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