Eiger BioPharmaceuticals (NASDAQ:EIGR) shareholders are in the red if they invested three years ago

Eiger BioPharmaceuticals, Inc. (NASDAQ:EIGR) shareholders will no doubt be very grateful to see the share price climb 41% in the last quarter. But that can’t eclipse the less than impressive returns of the past three years. After all, the stock price is down 42% over the past three years, significantly underperforming the market.

So let’s take a look and see if the company’s long-term performance has been in line with the progress of the underlying business.

See our latest analysis for Eiger BioPharmaceuticals

Eiger BioPharmaceuticals has not been profitable for the last twelve months, we are unlikely to see a strong correlation between its stock price and its earnings per share (EPS). Income is arguably our second best option. When a business is not making a profit, you generally expect to see good revenue growth. Some companies are willing to defer profitability to increase revenue faster, but in this case, good revenue growth is expected.

Over the past three years, Eiger BioPharmaceuticals has seen its revenue grow by 129% annually, compounded. It’s faster than most nonprofits. As its earnings have grown, the stock price has fallen at a rate of 12% per year. This appears to be an unlucky outcome for the Holders. It is possible that the previous stock price assumed unrealistic future growth. Before considering a purchase, investors should consider how quickly expenses are growing relative to income.

The image below shows how earnings and income have tracked over time (if you click on the image you can see more details).

earnings-and-revenue-growth

Take a closer look at the financial health of Eiger BioPharmaceuticals with this free report on its balance sheet.

A different perspective

We regret to report that Eiger BioPharmaceuticals shareholders are down 26% for the year. Unfortunately, this is worse than the general market decline of 8.5%. However, it could simply be that the stock price was impacted by greater market jitters. It might be worth keeping an eye on the fundamentals, in case there is a good opportunity. Unfortunately, last year’s performance may point to unresolved challenges, given that it was worse than the 1.9% annualized loss over the past half-decade. Generally speaking, long-term stock price weakness can be a bad sign, although contrarian investors may want to seek out the stock in hopes of a turnaround. It is always interesting to follow the evolution of the share price over the long term. But to better understand Eiger BioPharmaceuticals, we need to consider many other factors. Take risks, for example – Eiger BioPharmaceuticals has 3 warning signs we think you should know.

If you’d rather check out another company – one with potentially superior finances – then don’t miss this free list of companies that have proven that they can increase their profits.

Please note that the market returns quoted in this article reflect the average market-weighted returns of stocks currently trading on US exchanges.

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This Simply Wall St article is general in nature. We provide commentary based on historical data and analyst forecasts only using unbiased methodology and our articles are not intended to be financial advice. It is not a recommendation to buy or sell stocks and does not take into account your objectives or financial situation. Our goal is to bring you targeted long-term analysis based on fundamental data. Note that our analysis may not take into account the latest announcements from price-sensitive companies or qualitative materials. Simply Wall St has no position in the stocks mentioned.

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