Aadi Bioscience (AADI) AI Stock Analysis

• Market Cap: $50.63M
• Dividend Yield: N/A
• Average Volume (3M): N/A
• Price to Earnings (P/E): ―
• Beta (1Y): 0.14
• Revenue Growth: 7.80%
• EPS Growth: 3.12%
• Country: US
• Employees: 89
• Sector: Healthcare
• Sector Strength: 39
• Industry: Biotechnology
• EPS (TTM): -2.29
• Shares Outstanding: 24,696,568
• 10 Day Avg. Volume: N/A
• 30 Day Avg. Volume: N/A
• PEG Ratio: -0.13
• Price to Book (P/B): 0.69
• Price to Sales (P/S): 2.06
• P/FCF Ratio: -0.78
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: N/A
• Price Target Upside: N/A
• Rating Consensus: N/A
• Number of Analyst Covering: 0

• Rating: 57 Neutral
• Price Target: ―

Aadi Bioscience is experiencing significant financial challenges, reflected in its low profitability and negative cash flows. However, strong technical momentum and recent strategic initiatives, including substantial financing and investments in new technologies, offer potential upside. The overall score reflects the balance between current financial difficulties and positive future strategic prospects.

Positive Factors

Commercial Performance

Fyarro remains the only preferred treatment for PEComa and continues to see sustained sales with incremental growth expected.

Financial Strategy

Company will reduce 80% R&D workforce and extend cash runway into at least the second half of 2026.

Negative Factors

Clinical Trials

Aadi announced the discontinuation of nab-sirolimus' tumor agnostic and registration-directed PRECISION1 study.

Market Risks

Risks include: disappointing market uptake of FYARRO in the PEComa indication, inability to develop FYARRO in other cancers, failure of FYARRO to achieve commercial success due to market size, penetration rate, or competition, and potential medium- to long-term dilution risk.

Regulatory Challenges

IDMC analysis showed the pivotal Ph2 tumor agnostic study of nab-sirolimus in TSC1/TSC2 was unlikely to exceed efficacy threshold for accelerated approval.

Aadi Bioscience Business Overview & Revenue Model

Company Description

Aerpio Pharmaceuticals Inc. is a biopharmaceutical company, which engages in the research and development of treatments for ocular diseases. Its product candidate is AKB-9778, a small molecule activator of the Tie2 pathway, which completed the Phase 2a clinical trial for the treatment of diabetic retinopathy. It also develops ARP-1536, a humanized monoclonal antibody that is in preclinical development stage for the treatment of diabetic vascular complications; and AKB-4924, a selective stabilizer of hypoxia-inducible factor-1 alpha, which has completed a single ascending dose clinical trial for the treatment of inflammatory bowel disease. The company was founded by Joseph H. Garder on November 17, 2011 and is headquartered in Cincinnati, OH.

How the Company Makes Money

Aadi Bioscience makes money primarily through the development and commercialization of its drug products. The company's revenue model includes the sale of FYARRO, its lead product, which targets mTOR pathway alterations in cancer patients. Aadi may also enter into strategic partnerships or licensing agreements with other pharmaceutical companies to enhance its distribution network and expand its market reach. Additionally, the company could receive milestone payments or royalties from these collaborations, further contributing to its earnings.

Aadi Bioscience Financial Statement Overview

Summary

Aadi Bioscience shows promising revenue growth but is facing significant profitability challenges with high operating losses and negative cash flows. While the balance sheet remains relatively healthy with minimal debt, ongoing losses could pose risks to sustainability. Improvements in operational efficiency and loss reduction are critical for future stability.

Income Statement

Aadi Bioscience has shown some revenue growth over the years, with the most recent TTM revenue at $25.07 million, up from $24.35 million in 2023. However, the company is struggling with significant net losses, with a net loss of $61.69 million in the TTM period. Gross profit margins are high, indicating efficient production or service delivery, but operating and net profit margins are deeply negative due to high operating expenses, resulting in an EBIT margin of -264.19% and a net profit margin of -246.06%. This indicates ongoing profitability challenges.

Balance Sheet

The balance sheet shows a relatively healthy equity position with a stockholders' equity of $68.87 million as of the latest TTM period. The debt-to-equity ratio is low at 0.01, indicating minimal reliance on debt financing. However, the equity ratio is 80.36%, suggesting that while the company relies primarily on equity, the total asset base has been declining. Continued net losses could erode equity further, posing a risk to financial stability.

Cash Flow

Aadi Bioscience's cash flow statement reveals challenges in generating positive cash flows, with a negative free cash flow of $61.03 million in the TTM period. The operating cash flow to net income ratio is close to 1, indicating that the operating losses are largely reflective of the net losses. Free cash flow has slightly improved as capital expenditures decreased, but the overall cash flow situation remains a concern due to persistent operating losses.

Breakdown	TTM	Dec 2023	Dec 2022	Dec 2021	Dec 2020	Dec 2019
Income Statement
Total Revenue	25.07M	24.35M	15.22M	1.00M	14.00M	749.00K
Gross Profit	21.91M	21.55M	13.88M	724.00K	13.82M	672.50K
EBITDA	-61.28M	-65.36M	-60.12M	-109.15M	-2.48M	-24.44M
Net Income	-61.69M	-65.77M	-57.01M	-110.09M	-3.48M	-23.27M
Balance Sheet
Total Assets	64.12M	132.42M	184.24M	157.91M	18.82M	39.94M
Cash, Cash Equivalents and Short-Term Investments	62.61M	108.84M	172.56M	148.99M	4.46M	38.52M
Total Debt	0.00	1.27M	1.66M	605.00K	10.26M	169.99K
Total Liabilities	5.46M	27.23M	25.86M	21.50M	31.26M	3.40M
Stockholders Equity	58.67M	105.19M	158.38M	136.41M	-12.43M	36.54M
Cash Flow
Free Cash Flow	-61.03M	-63.63M	-50.08M	-22.47M	-12.70M	-24.09M
Operating Cash Flow	-61.20M	-59.66M	-49.64M	-22.42M	-12.70M	-23.85M
Investing Cash Flow	26.44M	83.21M	-132.89M	25.15M	-19.02K	-236.95K
Financing Cash Flow	157.00K	326.00K	72.62M	141.80M	1.19M	8.07M

Aadi Bioscience Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
AADI	57 Neutral	$50.63M	―	-65.95%	―	7.80%	3.12%
Sector *	52 Neutral	$7.45B	0.27	-61.87%	2.30%	16.62%	1.04%
TCRX	52 Neutral	$82.06M	―	-78.93%	―	-70.15%	―
SRRK	50 Neutral	$3.37B	―	-106.71%	―	―	-22.34%
BCYC	48 Neutral	$496.18M	―	-37.13%	―	-38.14%	29.69%
HOOK	41 Neutral	$14.39M	―	-105.79%	―	-82.54%	-12.53%
IMRX	27 Underperform	$145.74M	―	-102.48%	―	―	-7.78%

Aadi Bioscience Corporate Events

Aadi Bioscience’s Strategic Agreements and Funding Moves

Aadi Bioscience has entered into a Stock Purchase Agreement with KAKEN Pharmaceutical, selling its subsidiary, including the FYARRO business, for $100 million, which will fund operations into late 2028. Additionally, Aadi has secured an exclusive license for three novel ADC assets from WuXi Biologics and announced a $100 million PIPE financing to support the development of these assets, indicating a strategic shift towards leveraging advanced ADC technologies to address unmet cancer therapeutic needs.