Prothena (NASDAQ:PRTA) shareholder returns have been strong, earning 299% in 3 years
The worst result, after buying shares in a company (assuming no leverage), would be if you lose all the money you put in. But if you buy shares in a really great company, you can more than double your money. To wit, the Prothena Corporation plc (NASDAQ:PRTA) share price has flown 299% in the last three years. That sort of return is as solid as granite. It's even up 6.1% in the last week. But this might be partly because the broader market had a good week last week, gaining 3.3%.
Since the stock has added US$168m to its market cap in the past week alone, let's see if underlying performance has been driving long-term returns.
Check out our latest analysis for Prothena
Prothena isn't currently profitable, so most analysts would look to revenue growth to get an idea of how fast the underlying business is growing. Shareholders of unprofitable companies usually expect strong revenue growth. As you can imagine, fast revenue growth, when maintained, often leads to fast profit growth.
In the last 3 years Prothena saw its revenue grow at 91% per year. That's well above most pre-profit companies. Meanwhile, the share price performance has been pretty solid at 59% compound over three years. This suggests the market has recognized the progress the business has made, at least to a significant degree. That's not to say we think the share price is too high. In fact, it might be worth keeping an eye on this one.
You can see below how earnings and revenue have changed over time (discover the exact values by clicking on the image).
If you are thinking of buying or selling Prothena stock, you should check out this FREE detailed report on its balance sheet.
A Different Perspective
It's nice to see that Prothena shareholders have received a total shareholder return of 44% over the last year. That gain is better than the annual TSR over five years, which is 8%. Therefore it seems like sentiment around the company has been positive lately. In the best case scenario, this may hint at some real business momentum, implying that now could be a great time to delve deeper. It's always interesting to track share price performance over the longer term. But to understand Prothena better, we need to consider many other factors. Even so, be aware that Prothena is showing 2 warning signs in our investment analysis , you should know about...
Of course Prothena 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.
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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.
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