Phathom Pharmaceuticals' Financial Analysis in the Gastrointestinal Disease Market

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  Posted by John Deo Mar 10 - Filed in General - #financialmodelingprep  - 4 views
  
  • Phathom Pharmaceuticals, Inc. (NASDAQHAT) faces significant competition in developing treatments for gastrointestinal diseases, with a focus on acid-related disorders.
  • The company's Return on Invested Capital (ROIC) is -94.72%, indicating inefficiency in generating profits that exceed its cost of capital when compared to its peers.
  • Among its competitors, Crinetics Pharmaceuticals (CRNX) shows the least negative ROIC to WACC ratio, suggesting closer alignment towards achieving a positive return on invested capital.

  HAT">Phathom Pharmaceuticals, Inc. (NASDAQHAT) is a biopharmaceutical company focused on developing and commercializing novel treatments for gastrointestinal diseases. The company's primary product candidates are aimed at addressing unmet needs in acid-related disorders. In the competitive landscape, Phathom faces peers like Stoke Therapeutics, Y-mAbs Therapeutics, NGM Biopharmaceuticals, Arcutis Biotherapeutics, and Crinetics Pharmaceuticals, all of which are engaged in developing innovative therapies in various medical fields.

  Phathom's Return on Invested Capital (ROIC) is -94.72%, which is significantly lower than its Weighted Average Cost of Capital (WACC) of 14.04%. This results in a ROIC to WACC ratio of -6.75, indicating that the company is not currently generating returns that exceed its cost of capital. This negative spread suggests inefficiency in utilizing its capital to generate profits.

  In comparison, Stoke Therapeutics (STOK) has a ROIC of -53.07% and a WACC of 8.63%, leading to a ROIC to WACC ratio of -6.15. While still negative, Stoke's ratio is slightly better than Phathom's, indicating a smaller gap between its returns and cost of capital. This suggests that Stoke is marginally more efficient in its capital utilization compared to Phathom.

  Y-mAbs Therapeutics (YMAB) and NGM Biopharmaceuticals (NGM) also show negative ROIC to WACC ratios of -4.55 and -6.74, respectively. Y-mAbs, with a lower negative ratio, indicates a closer alignment of its returns with its cost of capital compared to Phathom. NGM's ratio is similar to Phathom's, suggesting comparable challenges in achieving profitability relative to their capital costs.

  Crinetics Pharmaceuticals (CRNX) stands out with the least negative ROIC to WACC ratio of -3.67 among the peers. This indicates that Crinetics is closer to achieving a positive return on its invested capital relative to its cost of capital, despite all companies currently having negative ROICs. This positions Crinetics as potentially more efficient in capital utilization compared to Phathom and its other peers.