Roivant Sciences Ltd. (ROIV) Stock Analysis and Metrics

Sector: Healthcare Industry: Biotechnology CIK: 0001635088

P/B 3.38

P/E -39.46

P/S 725.98

Market Cap 14.76 Bn

ROIC (Qtr) -27.53

Div Yield % 0.00

Rev 1y % (Qtr) -64.89

Total Debt (Qtr) 98.85 Mn

Debt/Equity (Qtr) 0.02

About

Roivant Sciences Ltd., often referred to as Roivant, is a commercial-stage biopharmaceutical company operating in the healthcare sector. Its primary focus is on improving the lives of patients by accelerating the development and commercialization of medicines that have a significant impact. Roivant's business model is unique, as it creates nimble subsidiaries, or "Vants," each with its own management team and mission. This approach allows Roivant to leverage its business development expertise, vast network of industry relationships, and proprietary...

Roivant Sciences Ltd., often referred to as Roivant, is a commercial-stage biopharmaceutical company operating in the healthcare sector. Its primary focus is on improving the lives of patients by accelerating the development and commercialization of medicines that have a significant impact. Roivant's business model is unique, as it creates nimble subsidiaries, or "Vants," each with its own management team and mission. This approach allows Roivant to leverage its business development expertise, vast network of industry relationships, and proprietary technologies to advance its pipeline.

The company's main business activities revolve around the development of medicines for inflammation and immunology, with a particular emphasis on novel topical treatments for psoriasis and atopic dermatitis, as well as fully human monoclonal antibodies targeting the neonatal Fc receptor (FcRn) for the treatment of IgG-mediated autoimmune diseases. Roivant's pipeline includes various programs in different stages of development, such as IMVT-1402, batoclimab, VTAMA, brepocitinib, and namilumab.

Roivant generates revenue through the development and commercialization of its medicines. Its primary products include VTAMA, a novel topical cream approved for the treatment of plaque psoriasis, and IMVT-1402 and batoclimab, fully human monoclonal antibodies targeting FcRn for the treatment of IgG-mediated autoimmune diseases. The company's customer base consists of dermatologists, rheumatologists, and other healthcare professionals who treat patients with psoriasis, atopic dermatitis, and other autoimmune diseases.

In terms of competition, Roivant competes with other biopharmaceutical companies that are developing novel treatments for autoimmune diseases, including Pfizer, Johnson & Johnson, and Eli Lilly. Roivant's competitive advantages include its nimble and entrepreneurial approach to drug development, its ability to leverage its business development expertise and proprietary technologies, and its focus on novel, targeted therapies.

Dermavant Sciences GmbH is one of Roivant's subsidiaries, which acquired the worldwide rights to VTAMA and related compounds from GlaxoSmithKline Intellectual Property Development Ltd. and Welichem Biotech Inc. in July 2018. Dermavant also entered into a collaboration and license agreement with Japan Tobacco Inc. in January 2020 for the development, registration, and marketing of tapinarof in Japan for the treatment of dermatological diseases and conditions.

Stock Price Chart

Analysis

Pros

Healthy cash reserves of 1.24B provide 137.42x coverage of short-term debt 9M, demonstrating strong liquidity position and minimal refinancing risk.
Strong tangible asset base of 5.06B provides 51.22x coverage of total debt 98.85M, indicating robust asset backing and low credit risk.
Short-term investments of 3.15B provide solid 28.68x coverage of other current liabilities 109.79M, indicating strong liquidity.
Long-term investments of 412.31M provide solid 4.59x coverage of long-term debt 89.84M, indicating strategic financial planning.
Tangible assets of 5.06B provide robust 46.11x coverage of other current liabilities 109.79M, indicating strong asset backing.

Cons

Operating cash flow of (769.86M) barely covers its investment activities of 562.97M, with a coverage ratio of -1.37, indicating heavy reliance on external financing for growth which may not be sustainable in a tighter credit environment.
Investment activities of 562.97M provide weak support for R&D spending of 604.32M, which is 0.93x, suggesting potentially insufficient investment in innovation relative to other capital deployment.
The company's operating cash flow of (769.86M) shows concerning coverage of stock compensation expenses of 331.17M, with a -2.32 ratio indicating potential earnings quality issues.
Free cash flow of (784.38M) provides weak coverage of capital expenditures of 14.52M, with a -54.02 ratio suggesting additional external financing needs for growth initiatives.
Operating cash flow of (769.86M) provides minimal -21.75x coverage of tax expenses of 35.40M, suggesting potential tax planning inefficiencies or unsustainable tax positions.

Peer Comparison

Companies in the Biotechnology

S.No.	Ticker	Company	Market Cap	P/E	P/S	Total Debt (Qtr)
1	SMMT	Summit Therapeutics Inc.	1,349.40 Bn	-1,464.17	0.00	0.01 Bn
2	ONC	BeOne Medicines Ltd.	437.43 Bn	6,381.20	87.97	1.90 Bn
3	VRTX	Vertex Pharmaceuticals Inc / Ma	116.09 Bn	31.59	9.90	1.83 Bn
4	REGN	Regeneron Pharmaceuticals, Inc.	78.10 Bn	17.06	5.48	2.71 Bn
5	ALNY	Alnylam Pharmaceuticals, Inc.	55.87 Bn	1,282.42	17.40	3.21 Bn
6	ARGX	Argenx Se	52.85 Bn	35.08	27,559.65	-
7	BNTC	Benitec Biopharma Inc.	41.75 Bn	-998.33	0.00	0.00 Bn
8	INSM	INSMED Inc	37.80 Bn	-31.93	84.56	0.74 Bn

Industry Comparisons

Current Valuation

Metric	Value	Industry
EV to Assets	2.69	12.31
EV to Cash from Ops.	-17.69	23.25
EV to Debt	137.79	738.44
EV to EBIT	-40.23	-9.16
EV to EBITDA	-11.98	6.95
EV to Free Cash Flow [EV/FCF]	-17.36	21.90
EV to Market Cap	0.92	65.67
EV to Revenue	669.96	227.32
Price to Book Value [P/B]	3.38	22.34
Price to Earnings [P/E]	-39.46	-11.77

Dividend Metrics

Metric	Value	Industry	Percentile
Dividend Coverage Ratio	0.00	-11.94
Dividend Payout Ratio %	0.00	0.16
Dividend per Basic Share	0.00	0.01
FCF Dividend Payout Ratio %	0.00	-0.14
Interest Coverage	0.00	841.00

Growth Metrics

Metric	Value	Industry
Capex Growth (1y) %	-444.88	-27.13
Cash and Equivalents Growth (1y) %	-36.84	734.65
Dividend Growth (1y) %	0.00	0.01
EBIAT Growth (1y) %	-107.77	-46.93
EBITDA Growth (1y) %	-125.24	-1.68
EBIT Growth (1y) %	-106.98	-56.45
EBT Growth (1y) %	-106.98	-12.70
EPS Growth (1y) %	-109.41	-28.31
FCF Growth (1y) %	-0.41	-31.90
Gross Profit Growth (1y) %	-45.87	226.84

Liquidity Ratios

Metric	Value	Industry
Asset Utilization Ratio	0.00	0.14
Cash Payout Ratio	0.00	0.00
Cash Ratio	9.24	3.85
Current Ratio	33.71	7.27
Debt to Equity Ratio	0.02	0.40
Interest Cover Ratio	0.00	841.00
Times Interest Earned	0.00	841.00

Profitability

Metric	Value	Industry
EBITDA Margin %	-1,596.90	-18,234.31
EBIT Margin %	-1,665.46	-18,580.80
EBT Margin %	-1,665.46	-19,488.74
Gross Margin %	96.40	-7.59
Net Profit Margin %	-1,839.60	-19,439.22

Roivant Sciences Ltd. (NASDAQ: ROIV)