When you buy a stock there is always a possibility that it could drop 100%. But when you pick a company that is really flourishing, you can make more than 100%. For example, the Ascendis Pharma A/S (NASDAQ:ASND) share price has soared 172% in the last half decade. Most would be very happy with that. Also pleasing for shareholders was the 15% gain in the last three months.

Since it's been a strong week for Ascendis Pharma shareholders, let's have a look at trend of the longer term fundamentals.

See our latest analysis for Ascendis Pharma

Ascendis Pharma isn't currently profitable, so most analysts would look to revenue growth to get an idea of how fast the underlying business is growing. When a company doesn't make profits, we'd generally expect to see good revenue growth. 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.

For the last half decade, Ascendis Pharma can boast revenue growth at a rate of 26% per year. That's well above most pre-profit companies. So it's not entirely surprising that the share price reflected this performance by increasing at a rate of 22% per year, in that time. This suggests the market has well and truly recognized the progress the business has made. To our minds that makes Ascendis Pharma worth investigating - it may have its best days ahead.

You can see below how earnings and revenue have changed over time (discover the exact values by clicking on the image).

Ascendis Pharma is a well known stock, with plenty of analyst coverage, suggesting some visibility into future growth. If you are thinking of buying or selling Ascendis Pharma stock, you should check out this free report showing analyst consensus estimates for future profits.

A Different Perspective

We're pleased to report that Ascendis Pharma shareholders have received a total shareholder return of 8.5% over one year. However, the TSR over five years, coming in at 22% per year, is even more impressive. The pessimistic view would be that be that the stock has its best days behind it, but on the other hand the price might simply be moderating while the business itself continues to execute. I find it very interesting to look at share price over the long term as a proxy for business performance. But to truly gain insight, we need to consider other information, too. For example, we've discovered 1 warning sign for Ascendis Pharma that you should be aware of before investing here.

But note: Ascendis Pharma may not be the best stock to buy. So take a peek at this free list of interesting companies with past earnings growth (and further growth forecast).

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

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

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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