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Immuneering (NASDAQ:IMRX) shareholders have endured a 77% loss from investing in the stock a year ago

It is a pleasure to report that the Immuneering Corporation (NASDAQ:IMRX) is up 49% in the last quarter. But that is meagre solace when you consider how the price has plummeted over the last year. During that time the share price has plummeted like a stone, down 77%. So it's not that amazing to see a bit of a bounce. The real question is whether the company can turn around its fortunes.

Since shareholders are down over the longer term, lets look at the underlying fundamentals over the that time and see if they've been consistent with returns.

View our latest analysis for Immuneering

With just US$1,515,459 worth of revenue in twelve months, we don't think the market considers Immuneering to have proven its business plan. We can't help wondering why it's publicly listed so early in its journey. Are venture capitalists not interested? So it seems shareholders are too busy dreaming about the progress to come than dwelling on the current (lack of) revenue. It seems likely some shareholders believe that Immuneering has the funding to invent a new product before too long.

We think companies that have neither significant revenues nor profits are pretty high risk. There is usually a significant chance that they will need more money for business development, putting them at the mercy of capital markets to raise equity. So the share price itself impacts the value of the shares (as it determines the cost of capital). While some such companies go on to make revenue, profits, and generate value, others get hyped up by hopeful naifs before eventually going bankrupt. Some Immuneering investors have already had a taste of the bitterness stocks like this can leave in the mouth.

Immuneering has plenty of cash in the bank, with cash in excess of all liabilities sitting at US$129m, when it last reported (March 2022). That allows management to focus on growing the business, and not worry too much about raising capital. But since the share price has dropped 77% in the last year , it seems like the market might have been over-excited previously. The image below shows how Immuneering's balance sheet has changed over time; if you want to see the precise values, simply click on the image.

debt-equity-history-analysis
debt-equity-history-analysis

In reality it's hard to have much certainty when valuing a business that has neither revenue or profit. Would it bother you if insiders were selling the stock? I would feel more nervous about the company if that were so. It only takes a moment for you to check whether we have identified any insider sales recently.

A Different Perspective

Immuneering shareholders are down 77% for the year, even worse than the market loss of 12%. That's disappointing, but it's worth keeping in mind that the market-wide selling wouldn't have helped. It's great to see a nice little 49% rebound in the last three months. Let's just hope this isn't the widely-feared 'dead cat bounce' (which would indicate further declines to come). It's always interesting to track share price performance over the longer term. But to understand Immuneering better, we need to consider many other factors. Case in point: We've spotted 5 warning signs for Immuneering you should be aware of, and 2 of them make us uncomfortable.

Immuneering is not the only stock that insiders are buying. For those who like to find winning investments this free list of growing companies with recent insider purchasing, could be just the ticket.

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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