Axsome Therapeutics (AXSM +1.04%) has been a red-hot stock to own over the past 12 months. During that stretch, it has soared by around 75%, dwarfing the performance of the S&P 500, which is up by 15% over that same time frame. The healthcare company, which develops therapies for the central nervous system, has been generating strong results in recent quarters, giving investors plenty of reasons to be bullish on its future.
Its next round of results come out on Feb. 23, when Axsome will report its quarterly numbers for the last three months of 2025, and when it'll also release its full-year numbers. Should you buy the stock before then?
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Axsome's stock didn't get much of a boost the last time the company reported earnings
When Axsome posted its most recent earnings numbers in November, the company demonstrated some impressive growth with its revenue rising by 63% on a year-over-year basis, totaling $171 million (for the period ended Sept. 30, 2025). It also trimmed its net loss from $64.6 million in the prior-year period to $47.2 million. Overall, it was an encouraging quarter for the company, which seemed to suggest it was progressing well and going in the right direction.
Despite the solid earnings numbers, the stock didn't surge in value after they came out. And even a week later, the stock was up less than 2%. A much bigger catalyst for the stock came at the end of the year, on Dec. 31, 2025, when regulators granted priority review for the application of the company's Alzheimer's drug, AXS-05. The target action date is set for April 30 of this year. The day the news came out, shares of Axsome jumped by 23%.
NASDAQ: AXSM
Key Data Points
The stock is a risky and expensive buy
Axsome's stock has been on an impressive run over the past 12 months, pushing its market capitalization up to around $9.4 billion in the process. The business isn't profitable, however, and while it has been growing, there may still be concerns about just how viable and safe the company is to invest in. Meanwhile, it trades at a price-to-sales multiple of 16, which isn't cheap.
For a company that's still in such early growth stages, it's likely to be news from regulators that has more of an impact on its share price than earnings results. As is evident with the sharp movement in price at the end of last year, investors may be eagerly anticipating approval of AXS-05 more than anything else.
But unless you are willing to take on the risk and uncertainty that comes with this healthcare stock, you may be better off taking a wait-and-see approach with it.
