Moderna (NASDAQ:MRNA) shareholders are still up 857% over 5 years despite pulling back 6.1% in the past week

Long term investing can be life changing when you buy and hold the truly great businesses. And highest quality companies can see their share prices grow by huge amounts. Don't believe it? Then look at the Moderna, Inc. (NASDAQ:MRNA) share price. It's 857% higher than it was five years ago. If that doesn't get you thinking about long term investing, we don't know what will. Also pleasing for shareholders was the 40% gain in the last three months. Anyone who held for that rewarding ride would probably be keen to talk about it.

Although Moderna has shed US$3.6b from its market cap this week, let's take a look at its longer term fundamental trends and see if they've driven returns.

View our latest analysis for Moderna

Given that Moderna didn't make a profit in the last twelve months, we'll focus on revenue growth to form a quick view of its business development. 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.

For the last half decade, Moderna can boast revenue growth at a rate of 40% per year. That's well above most pre-profit companies. Arguably, this is well and truly reflected in the strong share price gain of 57%(per year) over the same period. It's never too late to start following a top notch stock like Moderna, since some long term winners go on winning for decades. So we'd recommend you take a closer look at this one, but keep in mind the market seems optimistic.

The image below shows how earnings and revenue have tracked over time (if you click on the image you can see greater detail).

earnings-and-revenue-growth

Moderna is well known by investors, and plenty of clever analysts have tried to predict the future profit levels. You can see what analysts are predicting for Moderna in this interactive graph of future profit estimates.

A Different Perspective

Moderna shareholders gained a total return of 12% during the year. But that was short of the market average. If we look back over five years, the returns are even better, coming in at 57% per year for five years. Maybe the share price is just taking a breather while the business executes on its growth strategy. Most investors take the time to check the data on insider transactions. You can click here to see if insiders have been buying or selling.

We will like Moderna better if we see some big insider buys. While we wait, check out this free list of undervalued stocks (mostly small caps) with considerable, recent, insider buying.

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.

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