Xenon Pharmaceuticals Inc. (XENE) Stock Analysis and Metrics

Sector: Healthcare Industry: Biotechnology CIK: 0001582313

P/B 6.20

P/E -11.33

P/S 462.62

Market Cap 3.47 Bn

ROIC (Qtr) -56.73

Div Yield % 0.00

Rev 1y % (Qtr) 0.00

Total Debt (Qtr) 8.33 Mn

Debt/Equity (Qtr) 0.01

About

Xenon Pharmaceuticals Inc., often recognized by the symbol XENE on the NASDAQ stock exchange, is a company that operates within the biopharmaceutical industry. Its primary focus is on neuroscience, with an aim to enhance the lives of individuals dealing with neurological and psychiatric disorders. The company's main business activities revolve around the development of a novel product pipeline, specifically targeting areas of high unmet medical need such as epilepsy and depression. Xenon Pharmaceuticals Inc. operates in various countries, including...

Xenon Pharmaceuticals Inc., often recognized by the symbol XENE on the NASDAQ stock exchange, is a company that operates within the biopharmaceutical industry. Its primary focus is on neuroscience, with an aim to enhance the lives of individuals dealing with neurological and psychiatric disorders.

The company's main business activities revolve around the development of a novel product pipeline, specifically targeting areas of high unmet medical need such as epilepsy and depression. Xenon Pharmaceuticals Inc. operates in various countries, including the United States, and its reach extends to numerous regions worldwide.

Xenon Pharmaceuticals Inc. generates revenue primarily through the development and commercialization of novel products for the treatment of neurological and psychiatric disorders. Its primary product is XEN1101, a novel, potent Kv7 potassium channel opener being developed for the treatment of epilepsy and major depressive disorder. The company's customer base includes pharmaceutical companies, research institutions, and government agencies.

In the highly competitive biopharmaceutical industry, Xenon Pharmaceuticals Inc. maintains a strong position. In the epilepsy market, key competitors include Biohaven Ltd., Cerevel Therapeutics Holdings, Inc., Equilibre Biopharmaceuticals Corp., Johnson & Johnson Innovative Medicine, Neurona Therapeutics Inc., Praxis Precision Medicines, Inc., Rapport Therapeutics, Inc., SK Life Science Inc., Supernus Pharmaceuticals, Inc., and Zhimeng Biopharma, Inc. In the major depressive disorder market, competitors include AbbVie Inc., Biohaven Ltd., Intra-Cellular Therapies, Inc., Johnson & Johnson Innovative Medicine, Neumora Therapeutics, Inc., Relmada Therapeutics, Inc., Sage Therapeutics, Inc., and Sumitomo Pharma America, Inc.

Xenon Pharmaceuticals Inc.'s competitive advantage lies in its commitment to developing novel products for unmet medical needs. The company's focus on neuroscience allows it to address specific areas of need, making it a valuable player in the industry.

The company's product portfolio includes XEN1101, a novel, potent Kv7 potassium channel opener being developed for the treatment of epilepsy and major depressive disorder. This product has demonstrated positive results in Phase 2b clinical trials for epilepsy, showing a statistically significant and dose-dependent reduction in monthly focal seizure frequency compared to placebo. The company plans to initiate three Phase 3 clinical trials for major depressive disorder in the second half of 2024.

Stock Price Chart

Analysis

Pros

Healthy cash reserves of 104.51M provide 69.91x coverage of short-term debt 1.50M, demonstrating strong liquidity position and minimal refinancing risk.
Strong tangible asset base of 607.84M provides 73x coverage of total debt 8.33M, indicating robust asset backing and low credit risk.
Long-term investments of 92.99M provide solid 13.61x coverage of long-term debt 6.83M, indicating strategic financial planning.
Cash reserves of 104.51M provide robust 2.73x coverage of current liabilities 38.34M, indicating strong short-term solvency.
Cash reserves of 104.51M provide solid 33.09x coverage of other non-current liabilities 3.16M, indicating strong liquidity.

Cons

Operating cash flow of (252.02M) barely covers its investment activities of 253.80M, with a coverage ratio of -0.99, indicating heavy reliance on external financing for growth which may not be sustainable in a tighter credit environment.
Investment activities of 253.80M provide weak support for R&D spending of 272.71M, which is 0.93x, suggesting potentially insufficient investment in innovation relative to other capital deployment.
Short-term investments of 357.75M significantly exceed cash reserves of 104.51M, which is 3.42x, indicating potentially excessive yield-seeking behavior at the expense of liquidity.
The company's operating cash flow of (252.02M) shows concerning coverage of stock compensation expenses of 53.19M, with a -4.74 ratio indicating potential earnings quality issues.
Free cash flow of (253.29M) provides weak coverage of capital expenditures of 1.26M, with a -200.38 ratio suggesting additional external financing needs for growth initiatives.

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	5.50	12.31
EV to Cash from Ops.	-13.26	23.25
EV to Debt	401.47	738.44
EV to EBIT	-10.79	-9.16
EV to EBITDA	-9.95	6.95
EV to Free Cash Flow [EV/FCF]	-13.20	21.90
EV to Market Cap	0.96	65.67
EV to Revenue	445.74	227.32
Price to Book Value [P/B]	6.20	22.34
Price to Earnings [P/E]	-11.33	-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) %	46.67	-27.13
Cash and Equivalents Growth (1y) %	19.28	734.65
Dividend Growth (1y) %	0.00	0.01
EBIAT Growth (1y) %	-43.56	-46.93
EBITDA Growth (1y) %	-33.27	-1.68
EBIT Growth (1y) %	-44.83	-56.45
EBT Growth (1y) %	-44.83	-12.70
EPS Growth (1y) %	-37.94	-28.31
FCF Growth (1y) %	-53.72	-31.90
Gross Profit Growth (1y) %	0.00	226.84

Liquidity Ratios

Metric	Value	Industry
Asset Utilization Ratio	0.01	0.14
Cash Payout Ratio	0.00	0.00
Cash Ratio	2.73	3.85
Current Ratio	12.53	7.27
Debt to Equity Ratio	0.01	0.40
Interest Cover Ratio	0.00	841.00
Times Interest Earned	0.00	841.00

Profitability

Metric	Value	Industry
EBITDA Margin %	-4,065.40	-18,234.31
EBIT Margin %	-4,129.39	-18,580.80
EBT Margin %	-4,129.39	-19,488.74
Gross Margin %	100.00	-7.59
Net Profit Margin %	-4,084.50	-19,439.22

Xenon Pharmaceuticals Inc. (NASDAQ: XENE)