Unless you borrow money to invest, the potential losses are limited. But if you pick the right stock, you can make a lot more than 100%. Take, for example Iovance Biotherapeutics, Inc. (NASDAQ:IOVA). Its share price is already up an impressive 166% in the last twelve months. On top of that, the share price is up 44% in about a quarter. In contrast, the longer term returns are negative, since the share price is 55% lower than it was three years ago.

The past week has proven to be lucrative for Iovance Biotherapeutics investors, so let's see if fundamentals drove the company's one-year performance.

Iovance Biotherapeutics 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 it's hard to be confident a company will be sustainable if revenue growth is negligible, and it never makes a profit.

Over the last twelve months, Iovance Biotherapeutics' revenue grew by 13,670%. That's a head and shoulders above most loss-making companies. Meanwhile, the market has paid attention, sending the share price soaring 166% in response. It's great to see strong revenue growth, but the question is whether it can be sustained. The strong share price rise indicates optimism, so there may be a better opportunity for buyers as the hype fades a bit.

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

We consider it positive that insiders have made significant purchases in the last year. Even so, future earnings will be far more important to whether current shareholders make money. You can see what analysts are predicting for Iovance Biotherapeutics in this interactive graph of future profit estimates.

A Different Perspective

It's good to see that Iovance Biotherapeutics has rewarded shareholders with a total shareholder return of 166% in the last twelve months. There's no doubt those recent returns are much better than the TSR loss of 9% per year over five years. 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. 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. Consider risks, for instance. Every company has them, and we've spotted 2 warning signs for Iovance Biotherapeutics you should know about.

Iovance Biotherapeutics is not the only stock that insiders are buying. For those who like to find lesser know companies 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 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.