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While KalVista Pharmaceuticals, Inc. (NASDAQ:KALV) shareholders are probably generally happy, the stock hasn’t had particularly good run recently, with the share price falling 28% in the last quarter. But that doesn’t change the fact that the returns over the last year have been very strong. Like an eagle, the share price soared 156% in that time. So some might not be surprised to see the price retrace some. Investors should be wondering whether the business itself has the fundamental value required to continue to drive gains.
KalVista Pharmaceuticals isn’t a profitable company, so it is unlikely we’ll see a strong correlation between its share price and its earnings per share (EPS). Arguably revenue is our next best option. Shareholders of unprofitable companies usually expect strong revenue growth. That’s because it’s hard to be confident a company will be sustainable if revenue growth is negligible, and it never makes a profit.
KalVista Pharmaceuticals grew its revenue by 392% last year. That’s stonking growth even when compared to other loss-making stocks. Meanwhile, the market has paid attention, sending the share price soaring 156% in response. It’s great to see strong revenue growth, but the question is whether it can be sustained. The strong share price rise indicates optimism, so there may be a better opportunity for buyers as the hype fades a bit.
If you are thinking of buying or selling KalVista Pharmaceuticals stock, you should check out this FREE detailed report on its balance sheet.
A Different Perspective
KalVista Pharmaceuticals boasts a total shareholder return of 156% for the last year. We regret to report that the share price is down 28% over ninety days. It may simply be that the share price got ahead of itself, although there may have been fundamental developments that are weighing on it. You might want to assess this data-rich visualization of its earnings, revenue and cash flow.
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 US exchanges.
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.
If you spot an error that warrants correction, please contact the editor at email@example.com. 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. Simply Wall St has no position in the stocks mentioned. Thank you for reading.