Avalo Therapeutics (AVTX) AI Stock Analysis

• Market Cap: $57.42M
• Dividend Yield: N/A
• Average Volume (3M): 87.67K
• Price to Earnings (P/E): ―
• Beta (1Y): 0.75
• Revenue Growth: -77.09%
• EPS Growth: 63.49%
• Country: US
• Employees: 23
• Sector: Healthcare
• Sector Strength: 69
• Industry: Biotechnology
• EPS (TTM): -2.30
• Shares Outstanding: 10,671,934
• 10 Day Avg. Volume: 42,796
• 30 Day Avg. Volume: 87,671
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): 97.09
• Price to Cash Flow (P/CF): -1.70
• P/FCF Ratio: 0.00
• Enterprise Value/Market Cap: -0.94
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: 2.01
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: $33.33
• Price Target Upside: 566.60% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 7

Avalo Therapeutics' overall stock score is low due to significant financial challenges, including declining revenues and persistent losses. The technical analysis indicates a strong downtrend, though oversold conditions may offer a potential for a short-term rebound. The negative valuation underscores the company's financial instability. While the appointment of a new Chairman is a positive strategic move, it is insufficient to offset the broader financial difficulties.

Positive Factors

Financial Stability

Avalo Therapeutics ended the fiscal year with $134.5 million in cash and equivalents, which is expected to be sufficient to fund operations into 2027, indicating strong financial stability.

Market Opportunity

The market for hidradenitis suppurativa treatments is expanding, with biologics projected to generate significant revenue, which presents opportunities for Avalo Therapeutics.

Product Potential

AVTX-009 is expected to emerge as the best-in-class IL-1 inhibitor for hidradenitis suppurativa due to its differentiating features such as higher potency, better subcutaneous bioavailability, and longer half-life compared to competitors.

Negative Factors

Financial Performance

The company reported a net loss of $35.3M as it reported a loss of $26.5M in change in fair value of warrant liability.

Avalo Therapeutics Business Overview & Revenue Model

Company Description

Avalo Therapeutics (AVTX) is a biopharmaceutical company focused on developing and commercializing targeted therapies for immune-related diseases. The company operates in the biotechnology and pharmaceutical sectors, leveraging its expertise in immunology to address unmet medical needs. Avalo's core products and services include a pipeline of drug candidates designed to modulate immune responses in various autoimmune and inflammatory conditions.

How the Company Makes Money

Avalo Therapeutics makes money primarily through the development and commercialization of its drug candidates. The company generates revenue through partnerships and collaborations with larger pharmaceutical companies, which may include milestone payments, royalties, and licensing fees. Additionally, Avalo may receive funding from grants or government programs aimed at advancing medical research. The company's financial performance is significantly influenced by the progress and success of its clinical trials, regulatory approvals, and the eventual commercialization of its therapies.

Avalo Therapeutics Financial Statement Overview

Summary

Avalo Therapeutics faces significant financial challenges, with declining revenues, persistent losses, and negative cash flow. While the elimination of debt and improvements in equity are positives, the company's inability to generate positive cash flow and profits suggests substantial financial instability.

Income Statement

Avalo Therapeutics has experienced a significant decline in revenue over the years, with the most recent annual revenue dropping to $441,000 from $1,924,000 the previous year. The company also shows negative gross profit and net income over multiple years, indicating ongoing operational challenges. Additionally, the net profit margin is consistently negative, reflecting broader profitability issues.

Balance Sheet

The company's balance sheet shows a high equity ratio, primarily due to the elimination of total debt in the most recent year. However, the return on equity remains negative due to ongoing net losses. The stockholders' equity has improved significantly from negative to positive over the past year, which is a positive sign, but the lack of revenue growth remains concerning.

Cash Flow

Avalo Therapeutics demonstrates negative free cash flow consistently, indicating cash flow challenges. The operating cash flow to net income ratio is also negative, highlighting inefficiencies in translating operational activities into cash flow. Although financing activities have supported operations in previous years, the sustainability of this approach is uncertain given ongoing losses.

Breakdown
Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement		Total Revenue
441.00K	1.92M	18.05M	5.40M	6.70M
	Gross Profit
-26.83M	640.00K	14.62M	3.91M	6.40M
	EBIT
-68.51M	-23.44M	-37.44M	-82.13M	-26.95M
	EBITDA
-68.51M	-27.95M	-37.29M	-80.50M	-45.45M
	Net Income Common Stockholders
-35.13M	-31.54M	-41.66M	-84.35M	-64.38M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
134.55M	7.42M	13.17M	54.59M	18.92M
	Total Assets
150.73M	20.99M	33.37M	80.21M	43.76M
	Total Debt
568.00K	537.00K	19.42M	32.83M	426.35K
	Net Debt
-133.98M	-6.88M	6.24M	-21.75M	-18.49M
	Total Liabilities
17.70M	13.69M	44.28M	57.13M	19.19M
	Stockholders Equity
133.03M	7.30M	-10.91M	23.08M	24.56M
Cash Flow		Free Cash Flow
-49.06M	-30.84M	-26.85M	-71.00M	-40.60M
	Operating Cash Flow
-49.06M	-30.68M	-26.75M	-70.89M	-40.54M
	Investing Cash Flow
356.00K	-133.00K	-95.00K	-113.00K	11.13M
	Financing Cash Flow
175.85M	25.04M	-14.70M	106.76M	44.78M

Avalo Therapeutics Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 5.00
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For AVTX, the sentiment is Negative. The current price of 5 is below the 20-day moving average (MA) of 5.27, below the 50-day MA of 6.67, and below the 200-day MA of 9.02, indicating a bearish trend. The MACD of -0.63 indicates Negative momentum. The RSI at 40.15 is Neutral, neither overbought nor oversold. The STOCH value of 49.25 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for AVTX.

Avalo Therapeutics Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
Sector *	51 Neutral	$5.35B	3.41	-40.83%	2.89%	18.11%	2.60%
KRON	45 Neutral	$53.96M	―	-69.80%	―	56.62%	26.48%
PYXS	42 Neutral	$64.05M	―	-62.75%	―	―	30.51%
AVTX	37 Underperform	$57.42M	―	-50.06%	―	-77.09%	63.49%
ANRO	34 Underperform	$65.24M	―	-153.99%	―	―	―

Avalo Therapeutics Corporate Events

Avalo Therapeutics Appoints Michael Heffernan as Chairman

On March 25, 2025, Avalo Therapeutics appointed Michael Heffernan as Chairman of the Board, succeeding Dr. Garry Neil, who will remain as CEO and a Board member. This strategic move aims to leverage Heffernan’s extensive experience in biopharmaceuticals to advance Avalo’s pipeline, particularly the Phase 2 LOTUS trial for hidradenitis suppurativa, and aligns with the company’s growth and strategic direction.