Arcus Biosciences (NYSE:RCUS shareholders incur further losses as stock declines 11% this week, taking one-year losses to 48%

Investors can approximate the average market return by buying an index fund. But if you buy individual stocks, you can do both better or worse than that. For example, the Arcus Biosciences, Inc. (NYSE:RCUS) share price is down 48% in the last year. That falls noticeably short of the market return of around 6.1%. Even if you look out three years, the returns are still disappointing, with the share price down34% in that time. Shareholders have had an even rougher run lately, with the share price down 28% in the last 90 days.

Given the past week has been tough on shareholders, let's investigate the fundamentals and see what we can learn.

See our latest analysis for Arcus Biosciences

Given that Arcus Biosciences 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. Shareholders of unprofitable companies usually expect strong revenue growth. Some companies are willing to postpone profitability to grow revenue faster, but in that case one does expect good top-line growth.

In just one year Arcus Biosciences saw its revenue fall by 70%. That looks like a train-wreck result to investors far and wide. No surprise, then, that the share price fell 48% over the year. It's always work digging deeper, but we'd probably need to see a strong balance sheet and bottom line improvements to get interested in this one.

The company's revenue and earnings (over time) are depicted in the image below (click to see the exact numbers).

Arcus Biosciences is well known by investors, and plenty of clever analysts have tried to predict the future profit levels. You can see what analysts are predicting for Arcus Biosciences in this interactive graph of future profit estimates.

A Different Perspective

Arcus Biosciences shareholders are down 48% for the year, but the market itself is up 6.1%. Even the share prices of good stocks drop sometimes, but we want to see improvements in the fundamental metrics of a business, before getting too interested. Longer term investors wouldn't be so upset, since they would have made 6%, each year, over five years. It could be that the recent sell-off is an opportunity, so it may be worth checking the fundamental data for signs of a long term growth trend. 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. Consider risks, for instance. Every company has them, and we've spotted 2 warning signs for Arcus Biosciences you should know about.

Of course Arcus Biosciences 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.

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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.