Stoke Therapeutics, Inc. (NASDAQ:STOK) shareholders might be concerned after seeing the share price drop 17% in the last quarter. But that doesn't detract from the splendid returns of the last year. During that period, the share price soared a full 136%. So we think most shareholders won't be too upset about the recent fall. More important, going forward, is how the business itself is going.

Although Stoke Therapeutics has shed US$64m from its market cap this week, let's take a look at its longer term fundamental trends and see if they've driven returns.

Stoke Therapeutics isn't currently profitable, so most analysts would look to revenue growth to get an idea of how fast the underlying business is growing. Generally speaking, companies without profits are expected to grow revenue every year, and at a good clip. That's because fast revenue growth can be easily extrapolated to forecast profits, often of considerable size.

Over the last twelve months, Stoke Therapeutics' revenue grew by 81%. That's well above most other pre-profit companies. And the share price has responded, gaining 136% as we previously mentioned. It's great to see strong revenue growth, but the question is whether it can be sustained. Given the positive sentiment around the stock we're cautious, but there's no doubt its worth watching.

The graphic below depicts how earnings and revenue have changed over time (unveil the exact values by clicking on the image).

This free interactive report on Stoke Therapeutics' balance sheet strength is a great place to start, if you want to investigate the stock further.

A Different Perspective

We're pleased to report that Stoke Therapeutics shareholders have received a total shareholder return of 136% over one year. Notably the five-year annualised TSR loss of 10% per year compares very unfavourably with the recent share price performance. We generally put more weight on the long term performance over the short term, but the recent improvement could hint at a (positive) inflection point within the business. 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. Case in point: We've spotted 3 warning signs for Stoke Therapeutics you should be aware of.

But note: Stoke Therapeutics 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 American 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.