AbCellera Biologics Inc. (NASDAQ: ABCL)

Sector: Healthcare Industry: Biotechnology CIK: 0001703057
Market Cap 951.75 Mn
P/B 0.99
P/E -5.54
P/S 26.94
ROIC (Qtr) -19.33
Div Yield % 0.00
Rev 1y % (Qtr) 37.62
Total Debt (Qtr) 137.05 Mn
Debt/Equity (Qtr) 0.14

About

AbCellera Biologics Inc., a biotechnology company with the ticker symbol ABCL, operates in the global market for solutions that enable the discovery and development of therapeutic antibodies. The company's mission is to bring better antibody drugs to patients faster by solving general problems to catalyze a transformation in how antibody drugs are discovered. AbCellera's business model is capital-efficient and based on partnering, which enables the company to generate a significant competitive advantage in the maturity of its technology and the...

Read more

Price action

Investment thesis

Bull case

  • Strong tangible asset base of 1.27B provides 9.26x coverage of total debt 137.05M, indicating robust asset backing and low credit risk.
  • Tangible assets of 1.27B provide exceptional 58.92x coverage of deferred revenue 21.54M, showing strong service capability backing.
  • Short-term investments of 412.51M provide solid 26.30x coverage of other current liabilities 15.69M, indicating strong liquidity.
  • Long-term investments of 93.30M provide solid 0.68x coverage of long-term debt 137.05M, indicating strategic financial planning.
  • Tangible assets of 1.27B provide robust 80.89x coverage of other current liabilities 15.69M, indicating strong asset backing.

Bear case

  • Operating cash flow of (104.55M) barely covers its investment activities of 48.31M, with a coverage ratio of -2.16, indicating heavy reliance on external financing for growth which may not be sustainable in a tighter credit environment.
  • Investment activities of 48.31M provide weak support for R&D spending of 182.81M, which is 0.26x, suggesting potentially insufficient investment in innovation relative to other capital deployment.
  • Operating cash flow of (104.55M) provides insufficient coverage of deferred revenue obligations of 21.54M, which is -4.85x, raising concerns about future service delivery capabilities.
  • Short-term investments of 412.51M significantly exceed cash reserves of 108.16M, which is 3.81x, indicating potentially excessive yield-seeking behavior at the expense of liquidity.
  • The company's operating cash flow of (104.55M) shows concerning coverage of stock compensation expenses of 58.11M, with a -1.80 ratio indicating potential earnings quality issues.

Peer comparison

Companies in the Biotechnology
S.No. Ticker Company Market Cap P/E P/S Total Debt (Qtr)
1 SMMT Summit Therapeutics Inc. 1,151.25 Bn -1,249.17 0.00 0.01 Bn
2 ONC BeOne Medicines Ltd. 485.22 Bn 7,078.40 97.58 1.90 Bn
3 VRTX Vertex Pharmaceuticals Inc / Ma 122.74 Bn 33.40 10.47 1.83 Bn
4 REGN Regeneron Pharmaceuticals, Inc. 82.16 Bn 18.24 5.73 2.71 Bn
5 ARGX Argenx Se 48.85 Bn 32.43 25,472.44 -
6 ALNY Alnylam Pharmaceuticals, Inc. 46.12 Bn 1,058.58 14.37 3.21 Bn
7 BNTC Benitec Biopharma Inc. 42.24 Bn -1,010.00 0.00 0.00 Bn
8 INSM INSMED Inc 28.75 Bn -24.29 64.32 0.74 Bn

Industry comparisons

Current Valuation Value Ind Avg Percentile
EV to Assets EV to Assets 0.72 11.11
EV to Cash from Ops. EV/CFO -9.29 26.32
EV to Debt EV to Debt 7.09 688.48
EV to EBIT EV/EBIT -4.74 -10.97
EV to EBITDA EV/EBITDA -4.29 8.32
EV to Free Cash Flow [EV/FCF] EV/FCF -6.35 25.03
EV to Market Cap EV to Market Cap 1.02 163.46
EV to Revenue EV/Rev 27.50 148.57
Price to Book Value [P/B] P/B 0.99 20.73
Price to Earnings [P/E] P/E -5.54 -0.34
Dividend Metrics Value Ind Avg Percentile
Dividend Coverage Ratio Dividend Coverage Ratio 0.00 -12.47
Dividend Payout Ratio % Div Payout % (Qtr) 0.00 0.17
Dividend per Basic Share Div per Share (Qtr) 0.00 0.01
FCF Dividend Payout Ratio % FCF Div Payout % (Qtr) 0.00 -0.14
Interest Coverage Int. cover (Qtr) 0.00 860.86
Growth Metrics Value Ind Avg Percentile
Capex Growth (1y) % Capex 1y % (Qtr) 37.10 -26.99
Cash and Equivalents Growth (1y) % Cash & Equiv 1y % (Qtr) -28.67 756.75
Dividend Growth (1y) % Dividend Growth (1y) % 0.00 0.01
EBIAT Growth (1y) % EBIAT 1y % (Qtr) 2.34 -53.03
EBITDA Growth (1y) % EBITDA 1y % (Qtr) -4.92 -4.42
EBIT Growth (1y) % EBIT 1y % (Qtr) -1.36 -62.56
EBT Growth (1y) % EBT 1y % (Qtr) -1.36 -19.19
EPS Growth (1y) % EPS 1y % (Qtr) 6.56 -4.07
FCF Growth (1y) % FCF 1y % (Qtr) 22.42 -33.40
Gross Profit Growth (1y) % Gross Profit 1y % (Qtr) 7.16 264.38
Liquidity Ratios Value Ind Avg Percentile
Asset Utilization Ratio Asset Util Ratio (Qtr) 0.03 0.14
Cash Payout Ratio Cash Payout (Qtr) 0.00 0.00
Cash Ratio Cash Ratio (Qtr) 1.57 3.81
Current Ratio Curr Ratio (Qtr) 10.10 7.25
Debt to Equity Ratio Debt/Equity (Qtr) 0.14 0.43
Interest Cover Ratio Int Coverage (Qtr) 0.00 860.86
Times Interest Earned Times Interest Earned (Qtr) 0.00 860.86
Profitability Value Ind Avg Percentile
EBITDA Margin % EBITDA Margin % (Qtr) -481.60 -17,746.13
EBIT Margin % EBIT Margin % (Qtr) -580.13 -18,101.92
EBT Margin % EBT Margin % (Qtr) -580.13 -18,961.86
Gross Margin % Gross Margin % (Qtr) 100.00 -9.24
Net Profit Margin % Net Margin % (Qtr) -486.00 -18,911.61