Aclaris Therapeutics, Inc. (NASDAQ:ACRS) shareholders might be concerned after seeing the share price drop 20% in the last week. But over the last three years the stock has shone bright like a diamond. Over that time, we've been excited to watch the share price climb an impressive 998%. As long term investors the recent fall doesn't detract all that much from the longer term story. The thing to consider is whether there is still too much elation around the company's prospects. Anyone who held for that rewarding ride would probably be keen to talk about it.

Since the long term performance has been good but there's been a recent pullback of 20%, let's check if the fundamentals match the share price.

View our latest analysis for Aclaris Therapeutics

Aclaris Therapeutics wasn't profitable in the last twelve months, it is unlikely we'll see a strong correlation between its share price and its earnings per share (EPS). Arguably revenue is our next best option. Generally speaking, companies without profits are expected to grow revenue every year, and at a good clip. Some companies are willing to postpone profitability to grow revenue faster, but in that case one does expect good top-line growth.

In the last 3 years Aclaris Therapeutics saw its revenue grow at 41% per year. That's well above most pre-profit companies. And it's not just the revenue that is taking off. The share price is up 122% per year in that time. Despite the strong run, top performers like Aclaris Therapeutics have been known to go on winning for decades. In fact, it might be time to put it on your watchlist, if you're not already familiar with the stock.

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

Take a more thorough look at Aclaris Therapeutics' financial health with this free report on its balance sheet.

A Different Perspective

It's good to see that Aclaris Therapeutics has rewarded shareholders with a total shareholder return of 25% in the last twelve months. There's no doubt those recent returns are much better than the TSR loss of 5% per year over five years. This makes us a little wary, but the business might have turned around its fortunes. 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. For instance, we've identified 3 warning signs for Aclaris Therapeutics (1 is potentially serious) that you should be aware of.

If you like to buy stocks alongside management, then you might just love this free list of companies. (Hint: insiders have been buying them).

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.