In this commentary, I will examine MabVax Therapeutics Holdings Inc’s (NASDAQ:MBVX) latest earnings update (30 September 2017) and compare these figures against its performance over the past couple of years, as well as how the rest of the biotechnology industry performed. As an investor, I find it beneficial to assess MBVX’s trend over the short-to-medium term in order to gauge whether or not the company is able to meet its goals, and ultimately sustainably grow over time. View our latest analysis for MabVax Therapeutics Holdings
Did MBVX perform worse than its track record and industry?
For the most up-to-date info, I use the ‘latest twelve-month’ data, which annualizes the latest 6-month earnings release, or some times, the latest annual report is already the most recent financial data. This technique enables me to analyze different companies on a similar basis, using the latest information. MabVax Therapeutics Holdings’s most recent earnings -$27.9M, which, against last year’s figure, has become more negative. Since these figures are somewhat myopic, I have estimated an annualized five-year figure for MabVax Therapeutics Holdings’s earnings, which stands at -$18.7M. This doesn’t look much better, as earnings seem to have gradually been getting more and more negative over time.
We can further assess MabVax Therapeutics Holdings’s loss by looking at what’s going on in the industry as well as within the company. Initially, I want to briefly look into the line items. Revenue growth over last couple of years has been negative at -18.64%. The key to profitability here is to make sure the company’s cost growth is well-managed. Looking at growth from a sector-level, the US biotechnology industry has been growing its average earnings by double-digit 12.32% over the prior year, and 19.91% over the previous few years. This suggests that whatever tailwind the industry is benefiting from, MabVax Therapeutics Holdings has not been able to leverage it as much as its industry peers.
What does this mean?
While past data is useful, it doesn’t tell the whole story. Companies that incur net loss is always hard to forecast what will occur going forward, and when. The most useful step is to examine company-specific issues MabVax Therapeutics Holdings may be facing and whether management guidance has regularly been met in the past. I suggest you continue to research MabVax Therapeutics Holdings to get a better picture of the stock by looking at:
1. Future Outlook: What are well-informed industry analysts predicting for MBVX’s future growth? Take a look at our free research report of analyst consensus for MBVX’s outlook.