March 29, 2024

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Reflecting on NextCure’s (NASDAQ:NXTC) Share Price Returns Over The Last Year

Taking the occasional loss comes part and parcel with investing on the stock market. And unfortunately for NextCure, Inc. (NASDAQ:NXTC) shareholders, the stock is a lot lower today than it was a year ago. The share price has slid 61% in that time. NextCure may have better days ahead, of course; we’ve only looked at a one year period. The share price has dropped 74% in three months.

Check out our latest analysis for NextCure

Given that NextCure 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. Generally speaking, companies without profits are expected to grow revenue every year, and at a good clip. 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.

NextCure grew its revenue by 1,894% over the last year. That’s a strong result which is better than most other loss making companies. In contrast the share price is down 61% over twelve months. Yes, the market can be a fickle mistress. Typically a growth stock like this will be volatile, with some shareholders concerned about the red ink on the bottom line (that is, the losses). We’d definitely consider it a positive if the company is trending towards profitability. If you can see that happening, then perhaps consider adding this stock to your watchlist.

The graphic below depicts how earnings and revenue have changed over time (unveil the exact values by clicking on the image).

earnings-and-revenue-growth

It’s probably worth noting that the CEO is paid less than the median at similar sized companies. It’s always worth keeping an eye on CEO pay, but a more important question is whether the company will grow earnings throughout the years. So it makes a lot of sense to check out what analysts think NextCure will earn in the future (free profit forecasts).

A Different Perspective

Given that the market gained 19% in the last year, NextCure shareholders might be miffed that they lost 61%. While the aim is to do better than that, it’s worth recalling that even great long-term investments sometimes underperform for a year or more. It’s worth noting that the last three months did the real damage, with a 74% decline. So it seems like some holders have been dumping the stock of late – and that’s not bullish. 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. Even so, be aware that NextCure is showing 4 warning signs in our investment analysis , and 1 of those makes us a bit uncomfortable…

Of course NextCure 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 US exchanges.

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. 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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com.

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