Denali Therapeutics (DNLI) AI Stock Analysis

• Market Cap: $3.32B
• Dividend Yield: N/A
• Average Volume (3M): 1.44M
• Price to Earnings (P/E): ―
• Beta (1Y): 1.96
• Revenue Growth: N/A
• EPS Growth: -5.30%
• Country: US
• Employees: 443
• Sector: Healthcare
• Sector Strength: 45
• Industry: Biotechnology
• EPS (TTM): -0.74
• Shares Outstanding: 156,158,370
• 10 Day Avg. Volume: 2,022,536
• 30 Day Avg. Volume: 1,436,405
• PEG Ratio: -0.06
• Price to Book (P/B): 2.73
• Price to Sales (P/S): 0.00
• P/FCF Ratio: -9.22
• Enterprise Value/Market Cap: 0.93
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: -5.77
• 1Y Price Target: $33.00
• Price Target Upside: 55.08% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 12
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 54 Neutral
• Price Target: $23.00 ▲(8.08% Upside)

The score is held back primarily by weak financial performance (zero TTM revenue, large losses, and substantial cash burn despite a low-debt balance sheet). Offsetting this are strong technical momentum (price above major moving averages with positive MACD) and supportive corporate developments around financing and a near-term FDA catalyst, while valuation is constrained by negative earnings and no dividend support.

Positive Factors

Strong cash and recent financings

A large cash position combined with a late-2025 equity raise and royalty funding materially extends runway, enabling Denali to advance multiple clinical programs and prepare for potential commercial launch without immediate revenue, reducing near-term financing pressure.

Proprietary BBB delivery technology

Denali's transferrin-receptor enabled BBB delivery platform is a durable competitive advantage for CNS drug development; it can improve target engagement across multiple programs, increases partner interest, and supports a differentiated pipeline strategy with long-term value creation potential.

Non-dilutive funding while retaining rights

The royalty funding deal provides substantial upfront capital linked to a specific asset while preserving global commercialization rights, balancing near-term financing needs with potential upside retention and limiting immediate equity dilution if the contingent approval milestone is met.

Negative Factors

Zero revenue and large recurring losses

A zero-revenue run-rate with nearly half a billion in trailing losses reflects an inability to self-fund operations from product or collaboration sales; persistent operating losses increase reliance on external capital and elevate dilution and execution risk over the medium term.

High cash burn and negative free cash flow

Sustained negative operating and free cash flow erodes reserves and forces repeated financing or contingent deals. This structural cash burn can shift management focus toward liquidity solutions, potentially slowing R&D cadence and increasing financing-related dilution over time.

Eroding equity cushion despite low debt

Although leverage is low, the steady decline in shareholders' equity reduces the capital buffer to absorb future losses. Continued erosion raises the probability of equity raises or asset monetization, increasing dilution risk and constraining strategic flexibility over the medium term.

Denali Therapeutics Business Overview & Revenue Model

Company Description

Denali Therapeutics Inc., a biopharmaceutical company, discovers and develops therapeutic candidates for neurodegenerative diseases in the United States. It offers leucine-rich repeat kinase 2 (LRRK2) inhibitor product candidate, including BIIB122/DNL151, a small molecule inhibitor, which is in phase I and phase Ib clinical trials for the treatment of Parkinson's disease. The company also develops DNL310 that is in Phase I/II clinical trials for the treatment of hunter syndrome; DNL343, which is in phase 1 clinical trial the treatment of amyotrophic lateral sclerosis (ALS); AR443820/DNL788 completed a phase I clinical trial for the treatment of ALS, multiple sclerosis (MS), and Alzheimer's disease; and SAR443122/DNL758, which is in phase II clinical trial for the treatment of cutaneous lupus erythematosus. It has collaboration agreement with Takeda Pharmaceutical Company, Genentech, Inc., Sanofi, F-star Gamma Limited, F-star Biotechnologische Forschungs-Und Entwicklungsges M.B.H, F-star Biotechnology Limited, SIRION Biotech GmbH, Genzyme Corporation, Harvard University, the Michael J. Fox Foundation, and Centogene; and a research and option agreement with Secarna Pharmaceuticals GmbH & Co. KG. to develop antisense therapies in the field of neurodegenerative diseases. The company was formerly known as SPR Pharma Inc. and changed its name to Denali Therapeutics Inc. in March 2015. Denali Therapeutics Inc. was incorporated in 2013 and is headquartered in South San Francisco, California.

How the Company Makes Money

Denali Therapeutics generates revenue primarily through collaborations and licensing agreements with other pharmaceutical companies. These partnerships often involve milestone payments and royalties from the commercialization of co-developed products. Additionally, Denali may receive funding from research grants and government contracts to support its R&D activities. The company focuses on advancing its drug candidates through clinical trials, aiming for regulatory approval and subsequent market entry to drive future revenue growth. Key partnerships with industry leaders help bolster its financial position and expand its development capabilities.

Denali Therapeutics Financial Statement Overview

Summary

Overall fundamentals are weak: revenue is $0 TTM with large ongoing losses (TTM EBIT about -$548M; TTM net income about -$499M) and heavy cash burn (TTM operating cash flow about -$398M; TTM free cash flow about -$411M). The key offset is a relatively strong, low-debt balance sheet (debt-to-equity ~0.05), but continued losses are eroding equity and increase future dilution/financing risk.

Income Statement

Results have deteriorated materially since 2020 profitability: TTM (Trailing-Twelve-Months) revenue is $0 and losses remain large (TTM EBIT about -$548M; TTM net income about -$499M). While revenue scaled in 2022–2023 (to ~$331M in 2023), the company returned to a zero-revenue run-rate in the latest period, and margins are deeply negative across recent years—signaling high ongoing R&D/operating spend without offsetting commercial or collaboration revenue.

Balance Sheet

Balance sheet is a relative strength with low leverage: TTM debt is ~$44M against ~$926M of equity (debt-to-equity ~0.05), providing financial flexibility. The key weakness is the ongoing erosion of the equity base as losses persist (equity down from ~$1.23B in 2024 to ~$0.93B TTM) and consistently negative returns on equity, which increases future financing risk if burn rates remain elevated.

Cash Flow

Cash generation is weak and consistently negative: TTM operating cash flow is about -$398M and TTM free cash flow about -$411M, reflecting significant cash burn. A positive near-term sign is that free cash flow improved versus the prior period (TTM free cash flow growth is positive), but the business still relies on cash reserves and/or external funding to sustain operations.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	0.00	0.00	330.53M	108.46M	48.66M	335.66M
Gross Profit	0.00	0.00	330.53M	108.46M	48.66M	335.66M
EBITDA	-534.17M	-492.89M	-179.97M	-330.36M	-287.16M	71.25M
Net Income	-498.74M	-422.77M	-145.22M	-325.99M	-290.58M	71.14M
Balance Sheet
Total Assets	1.06B	1.37B	1.15B	1.46B	1.40B	1.60B
Cash, Cash Equivalents and Short-Term Investments	848.20M	832.33M	1.03B	1.34B	865.41M	1.47B
Total Debt	44.40M	48.71M	52.24M	60.35M	64.01M	68.86M
Total Liabilities	129.42M	144.50M	122.96M	417.81M	441.87M	453.75M
Stockholders Equity	926.20M	1.23B	1.03B	1.04B	962.29M	1.15B
Cash Flow
Free Cash Flow	-410.85M	-363.61M	-370.93M	-262.55M	-219.89M	413.06M
Operating Cash Flow	-397.78M	-347.69M	-357.99M	-244.72M	-211.39M	416.15M
Investing Cash Flow	406.72M	-88.76M	249.31M	-141.39M	-21.63M	-623.21M
Financing Cash Flow	-7.08M	484.30M	17.82M	310.67M	19.35M	634.75M

Denali Therapeutics Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 21.28
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For DNLI, the sentiment is Positive. The current price of 21.28 is above the 20-day moving average (MA) of 19.57, above the 50-day MA of 18.51, and above the 200-day MA of 15.75, indicating a bullish trend. The MACD of 1.18 indicates Negative momentum. The RSI at 60.91 is Neutral, neither overbought nor oversold. The STOCH value of 67.03 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for DNLI.

Denali Therapeutics Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
IDYA	63 Neutral	$2.92B	-17.12	-14.15%	―	5376.27%	20.97%
ARQT	60 Neutral	$3.19B	-73.54	-28.17%	―	129.21%	80.35%
CELC	56 Neutral	$4.98B	-28.40	-122.04%	―	―	-40.75%
DNLI	54 Neutral	$3.32B	-6.88	-44.44%	―	―	-5.30%
BEAM	53 Neutral	$2.73B	-5.58	-47.19%	―	-84.07%	-157.71%
Sector *	51 Neutral	$7.86B	-0.30	-43.30%	2.27%	22.53%	-2.21%
AGIO	49 Neutral	$1.62B	-3.82	-27.57%	―	36.26%	-158.98%

Denali Therapeutics Corporate Events

Denali Therapeutics Sets 2026 Priorities Ahead of Tividenofusp Decision

On January 6, 2026, Denali Therapeutics outlined its key priorities and expected milestones for 2026, positioning the year as a pivotal period as it prepares for a potential U.S. accelerated approval and commercial launch of tividenofusp alfa for Hunter syndrome, with an FDA decision due by April 5, 2026 and confirmatory data expected from the ongoing global Phase 2/3 COMPASS trial. The company also highlighted an anticipated wave of clinical readouts across its portfolio, including initial Phase 1/2 data for DNL126 in Sanfilippo syndrome Type A, patient data from the TAK-594/DNL593 frontotemporal dementia program, Phase 2b LUMA results for the LRRK2 Parkinson’s candidate BIIB122, and Phase 2 data for Sanofi-licensed eclitasertib in ulcerative colitis, alongside the initiation of first-in-human trials for multiple TV-enabled Alzheimer’s and Pompe disease therapies. Supported by roughly $873 million in cash and securities as of September 30, 2025, plus proceeds from a late-2025 equity raise and a royalty funding deal tied to future tividenofusp alfa sales, Denali signaled it has the capital to advance its clinical and commercial ambitions while reinforcing its strategy to establish leadership in transferrin receptor-enabled, blood-brain-barrier-crossing therapeutics.

The most recent analyst rating on (DNLI) stock is a Hold with a $16.50 price target. To see the full list of analyst forecasts on Denali Therapeutics stock, see the DNLI Stock Forecast page.

Denali Therapeutics Announces $200M Public Offering

On December 9, 2025, Denali Therapeutics entered into an underwriting agreement with major financial institutions for a public offering of its common stock and pre-funded warrants, aiming to raise approximately $200 million, potentially increasing to $230 million if additional shares are purchased. The offering is set to close on December 11, 2025, and is expected to strengthen Denali’s financial position, enhancing its ability to advance its therapeutic candidates and potentially impacting its market positioning in the biotechnology industry.

The most recent analyst rating on (DNLI) stock is a Buy with a $31.00 price target. To see the full list of analyst forecasts on Denali Therapeutics stock, see the DNLI Stock Forecast page.

Denali Therapeutics Secures $275M Royalty Funding Deal

On December 4, 2025, Denali Therapeutics entered into a $275 million synthetic royalty funding agreement with Royalty Pharma, which is contingent upon FDA approval of Denali’s investigational therapy, tividenofusp alfa, for Hunter syndrome. This agreement allows Denali to retain worldwide development and commercialization rights while providing Royalty Pharma a 9.25% royalty on future net sales, positioning Denali to advance its development programs and potentially transform treatment for Hunter syndrome.

The most recent analyst rating on (DNLI) stock is a Buy with a $32.00 price target. To see the full list of analyst forecasts on Denali Therapeutics stock, see the DNLI Stock Forecast page.

Denali Therapeutics Hosts Investor Day, Updates Pipeline

On December 4, 2025, Denali Therapeutics held its Investor Day, updating stakeholders on its development programs and future milestones. Key highlights include the ongoing FDA review of tividenofusp alfa for Hunter Syndrome, expected to conclude by April 2026, and the progression of other pipeline projects like DNL126 for Sanfilippo Syndrome and TAK-594 for Frontotemporal Dementia. The company anticipates minimal delays in its Pompe Disease program due to FDA requests for protocol amendments. These developments underscore Denali’s strategic focus on advancing its pipeline and preparing for potential commercial launches in 2026 and 2027.

The most recent analyst rating on (DNLI) stock is a Buy with a $32.00 price target. To see the full list of analyst forecasts on Denali Therapeutics stock, see the DNLI Stock Forecast page.