Praxis Precision Medicines, Inc. (NASDAQ: PRAX)

Sector: Healthcare Industry: Biotechnology CIK: 0001689548
Market Cap 6.20 Bn
P/B 18.05
P/E -22.71
P/S 831.02
ROIC (Qtr) -78.28
Div Yield % 0.00
Rev 1y % (Qtr) 0.00
Total Debt (Qtr) 436,000.00
Debt/Equity (Qtr) 0.00

About

Praxis Precision Medicines, Inc., often recognized by the stock symbol PRAX, operates as a clinical-stage biopharmaceutical company in the healthcare sector. With a focus on the central nervous system (CNS), Praxis Precision Medicines specializes in developing therapies for CNS disorders characterized by neuronal excitation-inhibition imbalance. The company's operations are driven by two proprietary platforms, Cerebrum and Solidus, which utilize deep understanding of neuronal excitability and neuronal networks to develop orally available precision...

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Price action

Investment thesis

Bull case

  • Healthy cash reserves of 149.53M provide 342.95x coverage of short-term debt 436000, demonstrating strong liquidity position and minimal refinancing risk.
  • Strong tangible asset base of 396.39M provides 909.15x coverage of total debt 436000, indicating robust asset backing and low credit risk.
  • Short-term investments of 117.63M provide solid 5.44x coverage of other current liabilities 21.63M, indicating strong liquidity.
  • Tangible assets of 396.39M provide robust 18.33x coverage of other current liabilities 21.63M, indicating strong asset backing.
  • Cash reserves of 149.53M provide robust 2.83x coverage of current liabilities 52.88M, indicating strong short-term solvency.

Bear case

  • Operating cash flow of (228.87M) barely covers its investment activities of 6.33M, with a coverage ratio of -36.18, indicating heavy reliance on external financing for growth which may not be sustainable in a tighter credit environment.
  • Investment activities of 6.33M provide weak support for R&D spending of 245.90M, which is 0.03x, suggesting potentially insufficient investment in innovation relative to other capital deployment.
  • The company's operating cash flow of (228.87M) shows concerning coverage of stock compensation expenses of 32.58M, with a -7.03 ratio indicating potential earnings quality issues.
  • Free cash flow of (228.92M) provides weak coverage of capital expenditures of 56000, with a -4087.88 ratio suggesting additional external financing needs for growth initiatives.
  • Operating earnings of (273.04M) show weak coverage of depreciation charges of 1.17M, with a -233.16 ratio indicating high capital intensity and potential reinvestment needs.

Product and Service Breakdown of Revenue (2024)

Product and Service Breakdown of Revenue (2024)

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 15.25 12.96
EV to Cash from Ops. EV/CFO -26.41 23.73
EV to Debt EV to Debt 13,865.18 772.65
EV to EBIT EV/EBIT -22.14 -11.30
EV to EBITDA EV/EBITDA -20.71 7.11
EV to Free Cash Flow [EV/FCF] EV/FCF -26.41 22.12
EV to Market Cap EV to Market Cap 0.97 68.89
EV to Revenue EV/Rev 810.03 199.70
Price to Book Value [P/B] P/B 18.05 22.62
Price to Earnings [P/E] P/E -22.71 -12.30
Dividend Metrics Value Ind Avg Percentile
Dividend Coverage Ratio Div Coverage (Qtr) 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) -12.00 -27.24
Cash and Equivalents Growth (1y) % Cash & Equiv 1y % (Qtr) -11.34 747.06
Dividend Growth (1y) % Dividend Growth (1y) % 0.00 0.01
EBIAT Growth (1y) % EBIAT 1y % (Qtr) -80.80 -48.21
EBITDA Growth (1y) % EBITDA 1y % (Qtr) -79.45 -2.09
EBIT Growth (1y) % EBIT 1y % (Qtr) -80.80 -57.79
EBT Growth (1y) % EBT 1y % (Qtr) -80.80 -14.35
EPS Growth (1y) % EPS 1y % (Qtr) -39.50 -30.88
FCF Growth (1y) % FCF 1y % (Qtr) -129.97 -32.51
Gross Profit Growth (1y) % Gross Profit 1y % (Qtr) 364.98 227.96
Liquidity Ratios Value Ind Avg Percentile
Asset Utilization Ratio Asset Util Ratio (Qtr) 0.02 0.14
Cash Payout Ratio Cash Payout (Qtr) 0.00 0.00
Cash Ratio Cash Ratio (Qtr) 2.83 3.79
Current Ratio Curr Ratio (Qtr) 5.18 7.23
Debt to Equity Ratio Debt/Equity (Qtr) 0.00 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) -3,642.80 -18,509.94
EBIT Margin % EBIT Margin % (Qtr) -3,658.53 -18,862.18
EBT Margin % EBT Margin % (Qtr) -3,658.53 -19,783.19
Gross Margin % Gross Margin % (Qtr) 100.00 -8.62
Net Profit Margin % Net Margin % (Qtr) -3,658.50 -19,732.60