Crinetics Pharmaceuticals, Inc. (NASDAQ: CRNX)

Sector: Healthcare Industry: Biotechnology CIK: 0001658247
Market Cap 4.98 Bn
P/B 4.65
P/E -11.78
P/S 3,246.62
ROIC (Qtr) -40.79
Div Yield % 0.00
Rev 1y % (Qtr) 0.00
Total Debt (Qtr) 49.14 Mn
Debt/Equity (Qtr) 0.05

About

Crinetics Pharmaceuticals, Inc. (CRNX) operates in the pharmaceutical industry, specifically focused on the discovery, development, and commercialization of novel therapeutics for endocrine diseases and endocrine-related tumors. The company's primary products include paltusotine, CRN04894, and CRN01941, which are in various stages of development to treat different endocrine-related diseases and conditions. Crinetics Pharmaceuticals' main business activities involve the research and development of orally available therapies for endocrine diseases...

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Price action

Investment thesis

Bull case

  • Healthy cash reserves of 111.40M provide 17.30x coverage of short-term debt 6.44M, demonstrating strong liquidity position and minimal refinancing risk.
  • Strong tangible asset base of 1.20B provides 24.34x coverage of total debt 49.14M, indicating robust asset backing and low credit risk.
  • Tangible assets of 1.20B provide exceptional 207.93x coverage of deferred revenue 5.75M, showing strong service capability backing.
  • Short-term investments of 981.39M provide solid 28.83x coverage of other current liabilities 34.04M, indicating strong liquidity.
  • Tangible assets of 1.20B provide robust 35.14x coverage of other current liabilities 34.04M, indicating strong asset backing.

Bear case

  • Operating cash flow of (349.69M) barely covers its investment activities of (425.29M), with a coverage ratio of 0.82, indicating heavy reliance on external financing for growth which may not be sustainable in a tighter credit environment.
  • Investment activities of (425.29M) provide weak support for R&D spending of 313.57M, which is -1.36x, suggesting potentially insufficient investment in innovation relative to other capital deployment.
  • Operating cash flow of (349.69M) provides insufficient coverage of deferred revenue obligations of 5.75M, which is -60.80x, raising concerns about future service delivery capabilities.
  • Short-term investments of 981.39M significantly exceed cash reserves of 111.40M, which is 8.81x, indicating potentially excessive yield-seeking behavior at the expense of liquidity.
  • The company's operating cash flow of (349.69M) shows concerning coverage of stock compensation expenses of 88.15M, with a -3.97 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. 1,446.17 Bn -1,569.17 0.00 0.01 Bn
2 ONC BeOne Medicines Ltd. 439.23 Bn 6,407.40 88.33 1.90 Bn
3 VRTX Vertex Pharmaceuticals Inc / Ma 120.62 Bn 32.82 10.29 1.83 Bn
4 REGN Regeneron Pharmaceuticals, Inc. 84.40 Bn 18.44 5.92 2.71 Bn
5 ALNY Alnylam Pharmaceuticals, Inc. 56.13 Bn 1,288.39 17.49 3.21 Bn
6 ARGX Argenx Se 47.89 Bn 31.79 24,973.95 -
7 BNTC Benitec Biopharma Inc. 42.45 Bn -1,015.00 0.00 0.00 Bn
8 INSM INSMED Inc 32.67 Bn -27.60 73.08 0.74 Bn

Industry comparisons

Current Valuation Value Ind Avg Percentile
EV to Assets EV to Assets 4.16 12.96
EV to Cash from Ops. EV/CFO -14.24 23.73
EV to Debt EV to Debt 101.32 772.65
EV to EBIT EV/EBIT -11.77 -11.30
EV to EBITDA EV/EBITDA -10.57 7.11
EV to Free Cash Flow [EV/FCF] EV/FCF -13.99 22.12
EV to Market Cap EV to Market Cap 1.00 68.89
EV to Revenue EV/Rev 3,243.82 199.70
Price to Book Value [P/B] P/B 4.65 22.62
Price to Earnings [P/E] P/E -11.78 -12.30
Dividend Metrics Value Ind Avg Percentile
Dividend Coverage Ratio Dividend Coverage Ratio 0.00 -12.02
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 -0.15
Interest Coverage Int. cover (Qtr) 0.00 857.11
Growth Metrics Value Ind Avg Percentile
Capex Growth (1y) % Capex 1y % (Qtr) -68.88 -27.24
Cash and Equivalents Growth (1y) % Cash & Equiv 1y % (Qtr) -65.03 747.06
Dividend Growth (1y) % Dividend Growth (1y) % 0.00 0.01
EBIAT Growth (1y) % EBIAT 1y % (Qtr) -52.24 -48.21
EBITDA Growth (1y) % EBITDA 1y % (Qtr) -56.26 -2.09
EBIT Growth (1y) % EBIT 1y % (Qtr) -52.24 -57.79
EBT Growth (1y) % EBT 1y % (Qtr) -52.24 -14.35
EPS Growth (1y) % EPS 1y % (Qtr) -21.83 -30.88
FCF Growth (1y) % FCF 1y % (Qtr) -73.18 -32.51
Gross Profit Growth (1y) % Gross Profit 1y % (Qtr) 47.74 227.96
Liquidity Ratios Value Ind Avg Percentile
Asset Utilization Ratio Asset Util Ratio (Qtr) 0.00 0.14
Cash Payout Ratio Cash Payout (Qtr) 0.00 0.00
Cash Ratio Cash Ratio (Qtr) 1.50 3.79
Current Ratio Curr Ratio (Qtr) 15.12 7.23
Debt to Equity Ratio Debt/Equity (Qtr) 0.05 0.42
Interest Cover Ratio Int Coverage (Qtr) 0.00 857.11
Times Interest Earned Times Interest Earned (Qtr) 0.00 857.11
Profitability Value Ind Avg Percentile
EBITDA Margin % EBITDA Margin % (Qtr) -27,120.10 -18,509.94
EBIT Margin % EBIT Margin % (Qtr) -27,563.32 -18,862.18
EBT Margin % EBT Margin % (Qtr) -27,563.32 -19,783.19
Gross Margin % Gross Margin % (Qtr) 100.00 -8.62
Net Profit Margin % Net Margin % (Qtr) -27,563.30 -19,732.60