Pharming Group N.V. (NASDAQ: PHAR)

Sector: Healthcare Industry: Biotechnology CIK: 0001828316
Market Cap 1.05 Bn
P/B 3.37
P/E 2,331.59
P/S 2.46
ROIC (Qtr) 3.47
Div Yield % 0.00
Rev 1y % (Qtr) 37.62
Total Debt (Qtr) 154.03 Mn
Debt/Equity (Qtr) 0.49

About

Pharming Group N.V., often recognized by its stock symbol PHAR, is a biopharmaceutical company operating in the biotechnology industry. The company specializes in the development and commercialization of innovative protein replacement therapies. Pharming's primary business activities involve the creation of novel pharmaceuticals and biologics, with a specific focus on protein replacement therapies. These therapies are designed to treat various medical conditions, including Hereditary Angioedema (HAE). Pharming operates in several countries, primarily...

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Price action

Investment thesis

Bull case

  • Strong operating cash flow of 62.74M provides robust 0.41x coverage of total debt 154.03M, indicating excellent debt servicing capability and financial flexibility.
  • Healthy cash reserves of 156.54M provide 13.73x coverage of short-term debt 11.40M, demonstrating strong liquidity position and minimal refinancing risk.
  • Operating cash flow of 62.74M provides exceptional 170.39x coverage of minority interest expenses 368235.29, showing strong core operations.
  • Strong tangible asset base of 398.66M provides 2.59x coverage of total debt 154.03M, indicating robust asset backing and low credit risk.
  • Robust free cash flow of 62.03M exceeds capital expenditure of 717647.06 by 86.43x, indicating strong organic growth funding capability.

Bear case

  • Investment activities of 19.42M provide weak support for R&D spending of 106.50M, which is 0.18x, suggesting potentially insufficient investment in innovation relative to other capital deployment.
  • Cash reserves of 156.54M provide limited coverage of acquisition spending of (67.62M), which is -2.32x, suggesting aggressive expansion might strain liquidity if market conditions deteriorate.
  • The company's operating cash flow of 62.74M shows concerning coverage of stock compensation expenses of 14M, with a 4.48 ratio indicating potential earnings quality issues.
  • Operating earnings of 17.69M show weak coverage of depreciation charges of 18.48M, with a 0.96 ratio indicating high capital intensity and potential reinvestment needs.
  • Free cash flow of 62.03M represents just -5.01x of debt issuance (12.39M), suggesting concerning reliance on leverage rather than internal cash generation for growth.

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 2.25 12.96
EV to Cash from Ops. EV/CFO 19.99 23.73
EV to Debt EV to Debt 8.14 772.65
EV to EBIT EV/EBIT 70.89 -11.30
EV to EBITDA EV/EBITDA 25.36 7.11
EV to Free Cash Flow [EV/FCF] EV/FCF 20.22 22.12
EV to Market Cap EV to Market Cap 1.20 68.89
EV to Revenue EV/Rev 2.94 199.70
Price to Book Value [P/B] P/B 3.37 22.62
Price to Earnings [P/E] P/E 2,331.59 -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 Interest Coverage 0.00 857.11
Growth Metrics Value Ind Avg Percentile
Capex Growth (1y) % Capex 1y % (Qtr) 33.00 -27.24
Cash and Equivalents Growth (1y) % Cash & Equiv 1y % (Qtr) 132.25 747.06
Dividend Growth (1y) % Dividend Growth (1y) % 0.00 0.01
EBIAT Growth (1y) % EBIAT 1y % (Qtr) 102.27 -48.21
EBITDA Growth (1y) % EBITDA 1y % (Qtr) 2,565.45 -2.09
EBIT Growth (1y) % EBIT 1y % (Qtr) 192.57 -57.79
EBT Growth (1y) % EBT 1y % (Qtr) 192.57 -14.35
EPS Growth (1y) % EPS 1y % (Qtr) 0.00 -30.88
FCF Growth (1y) % FCF 1y % (Qtr) 10,981.73 -32.51
Gross Profit Growth (1y) % Gross Profit 1y % (Qtr) 35.00 227.96
Liquidity Ratios Value Ind Avg Percentile
Asset Utilization Ratio Asset Util Ratio (Qtr) 0.90 0.14
Cash Payout Ratio Cash Payout Ratio 0.00 0.00
Cash Ratio Cash Ratio (Qtr) 1.51 3.79
Current Ratio Curr Ratio (Qtr) 3.16 7.23
Debt to Equity Ratio Debt/Equity (Qtr) 0.49 0.42
Interest Cover Ratio Interest Cover Ratio 0.00 857.11
Times Interest Earned Times Interest Earned 0.00 857.11
Profitability Value Ind Avg Percentile
EBITDA Margin % EBITDA Margin % (Qtr) 8.50 -18,509.94
EBIT Margin % EBIT Margin % (Qtr) 3.53 -18,862.18
EBT Margin % EBT Margin % (Qtr) 4.15 -19,783.19
Gross Margin % Gross Margin % (Qtr) 89.90 -8.62
Net Profit Margin % Net Margin % (Qtr) 0.10 -19,732.60