PTC Therapeutics' (NASDAQ:PTCT) investors will be pleased with their solid 101% return over the last year

The most you can lose on any stock (assuming you don't use leverage) is 100% of your money. But if you pick the right business to buy shares in, you can make more than you can lose. For example, the PTC Therapeutics, Inc. (NASDAQ:PTCT) share price had more than doubled in just one year - up 101%. In more good news, the share price has risen 11% in thirty days. But the price may well have benefitted from a buoyant market, since stocks have gained 4.5% in the last thirty days. However, the stock hasn't done so well in the longer term, with the stock only up 18% in three years.

So let's investigate and see if the longer term performance of the company has been in line with the underlying business' progress.

See our latest analysis for PTC Therapeutics

Because PTC Therapeutics made a loss in the last twelve months, we think the market is probably more focussed on revenue and revenue growth, at least for now. When a company doesn't make profits, we'd generally hope to see good revenue growth. Some companies are willing to postpone profitability to grow revenue faster, but in that case one would hope for good top-line growth to make up for the lack of earnings.

PTC Therapeutics grew its revenue by 13% last year. That's not great considering the company is losing money. So we wouldn't have expected the share price to rise by 101%. We're happy that investors have made money, though we wonder if the increase will be sustained. We're not so sure that revenue growth is driving the market optimism about the stock.

The image below shows how earnings and revenue have tracked over time (if you click on the image you can see greater detail).

PTC Therapeutics is a well known stock, with plenty of analyst coverage, suggesting some visibility into future growth. So we recommend checking out this free report showing consensus forecasts

A Different Perspective

It's nice to see that PTC Therapeutics shareholders have received a total shareholder return of 101% over the last year. Notably the five-year annualised TSR loss of 3% per year compares very unfavourably with the recent share price performance. The long term loss makes us cautious, but the short term TSR gain certainly hints at a brighter future. It's always interesting to track share price performance over the longer term. But to understand PTC Therapeutics better, we need to consider many other factors. Even so, be aware that PTC Therapeutics is showing 3 warning signs in our investment analysis , and 1 of those is a bit concerning...

We will like PTC Therapeutics better if we see some big insider buys. While we wait, check out this free list of undervalued stocks (mostly small caps) with considerable, recent, insider buying.

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.