MannKind Corporation (NASDAQ:MNKD) is a biopharmaceutical company that focuses on the development and commercialization of inhaled therapeutic products for patients with diseases such as diabetes. The company's flagship product, Afrezza, is an inhalable insulin used to control blood sugar levels in adults with diabetes. MannKind operates in a competitive landscape alongside companies like Geron Corporation, Celldex Therapeutics, ACADIA Pharmaceuticals, Amarin Corporation, and Exelixis.
MannKind's Return on Invested Capital (ROIC) is 20.47%, while its Weighted Average Cost of Capital (WACC) is 12.15%. This results in a ROIC to WACC ratio of 1.69, indicating that MannKind is effectively generating returns that exceed its cost of capital. This is a positive indicator for investors, as it suggests that the company is using its capital efficiently to generate profits.
In comparison, Geron Corporation has a negative ROIC of -34.35% and a WACC of 8.10%, resulting in a ROIC to WACC ratio of -4.24. This negative ratio suggests that Geron is not generating sufficient returns to cover its cost of capital, which could be a concern for investors. Similarly, Celldex Therapeutics has a ROIC of -25.98% and a WACC of 12.31%, leading to a ROIC to WACC ratio of -2.11, indicating inefficiency in capital utilization.
ACADIA Pharmaceuticals, on the other hand, has a ROIC of 25.22% and a WACC of 5.75%, resulting in a ROIC to WACC ratio of 4.39. This high ratio suggests that ACADIA is generating significantly higher returns on its invested capital compared to its cost of capital, indicating strong financial performance. Exelixis also shows a positive ROIC to WACC ratio of 2.81, with a ROIC of 18.19% and a WACC of 6.48%, suggesting efficient capital utilization.
Amarin Corporation, however, has a ROIC of -10.57% and a WACC of 12.36%, resulting in a ROIC to WACC ratio of -0.86. This negative ratio indicates that Amarin is not generating enough returns to cover its cost of capital, which could be a red flag for investors. Overall, while MannKind shows a favorable ROIC to WACC ratio, ACADIA Pharmaceuticals stands out with the highest ratio among its peers, suggesting superior capital efficiency.
