Stock Analysis
- United States
- /
- Life Sciences
- /
- NasdaqCM:CSBR
Champions Oncology (NASDAQ:CSBR) shareholders have lost 51% over 1 year, earnings decline likely the culprit
The nature of investing is that you win some, and you lose some. And there's no doubt that Champions Oncology, Inc. (NASDAQ:CSBR) stock has had a really bad year. The share price is down a hefty 51% in that time. At least the damage isn't so bad if you look at the last three years, since the stock is down 14% in that time. The falls have accelerated recently, with the share price down 16% in the last three months.
If the past week is anything to go by, investor sentiment for Champions Oncology isn't positive, so let's see if there's a mismatch between fundamentals and the share price.
View our latest analysis for Champions Oncology
We don't think that Champions Oncology's modest trailing twelve month profit has the market's full attention at the moment. We think revenue is probably a better guide. Generally speaking, we'd consider a stock like this alongside loss-making companies, simply because the quantum of the profit is so low. It would be hard to believe in a more profitable future without growing revenues.
In the last year Champions Oncology saw its revenue grow by 22%. We think that is pretty nice growth. Meanwhile, the share price tanked 51%, suggesting the market had much higher expectations. It is of course possible that the business will still deliver strong growth, it will just take longer than expected to do it. For us it's important to consider when you think a company will become profitable, if you're basing your valuation on revenue.
The image below shows how earnings and revenue have tracked over time (if you click on the image you can see greater detail).
It is of course excellent to see how Champions Oncology has grown profits over the years, but the future is more important for shareholders. If you are thinking of buying or selling Champions Oncology stock, you should check out this FREE detailed report on its balance sheet.
A Different Perspective
We regret to report that Champions Oncology shareholders are down 51% for the year. Unfortunately, that's worse than the broader market decline of 12%. Having said that, it's inevitable that some stocks will be oversold in a falling market. The key is to keep your eyes on the fundamental developments. On the bright side, long term shareholders have made money, with a gain of 3% per year over half a decade. If the fundamental data continues to indicate long term sustainable growth, the current sell-off could be an opportunity worth considering. It's always interesting to track share price performance over the longer term. But to understand Champions Oncology better, we need to consider many other factors. For instance, we've identified 3 warning signs for Champions Oncology that you should be aware of.
Of course Champions Oncology may not be the best stock to buy. So you may wish to see this free collection of growth stocks.
Please note, the market returns quoted in this article reflect the market weighted average returns of stocks that currently trade on American exchanges.
What are the risks and opportunities for Champions Oncology?
Champions Oncology, Inc. develops and sells technology solutions and products to personalize the development and use of oncology drugs in the United States.
Rewards
Trading at 70.6% below our estimate of its fair value
Revenue is forecast to grow 14.38% per year
Risks
Does not have a meaningful market cap ($56M)
Currently unprofitable and not forecast to become profitable over the next 3 years
Further research on
Champions Oncology
Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.
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.
About NasdaqCM:CSBR
Champions Oncology
Champions Oncology, Inc. develops and sells technology solutions and products to personalize the development and use of oncology drugs in the United States.
Undervalued with excellent balance sheet.
