Design Therapeutics (DSGN) AI Stock Analysis

• Market Cap: $224.78M
• Dividend Yield: N/A
• Average Volume (3M): 129.84K
• Price to Earnings (P/E): ―
• Beta (1Y): 1.97
• Revenue Growth: N/A
• EPS Growth: 26.63%
• Country: US
• Employees: 54
• Sector: Healthcare
• Sector Strength: 64
• Industry: Biotechnology
• EPS (TTM): -0.88
• Shares Outstanding: 56,762,676
• 10 Day Avg. Volume: 186,560
• 30 Day Avg. Volume: 129,841
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): N/A
• Price to Cash Flow (P/CF): -6.90
• P/FCF Ratio: 0.00
• 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: $5.00
• Price Target Upside: 26.26% Upside
• Rating Consensus: Hold
• Number of Analyst Covering: 1

Design Therapeutics has significant financial challenges, with persistent losses and negative cash flows indicating a risky financial position. The technical analysis points to a bearish trend, and the valuation metrics are unfavorable, with a negative P/E ratio. While the balance sheet shows some financial stability, the overall outlook is negative due to the lack of revenue generation and profitability.

Positive Factors

Clinical Trials

DSGN is on track to initiate the Phase 1 single ascending dose study in healthy volunteers and to initiate FA patient dosing.

Drug Development

DSGN's new formulation, DT-216P2, has demonstrated an improved PK profile, an improved injection site safety profile, and more sustained drug exposure in preclinical models compared to the prior formulation.

Negative Factors

Financial Performance

DSGN reported a net loss of $11.8M or $(0.21) per share for 2Q24.

Design Therapeutics Business Overview & Revenue Model

Company Description

Design Therapeutics, Inc. a preclinical-stage biopharmaceutical company, engages in the development of therapies for the treatment of genetic diseases caused by nucleotide repeat expansions. The company's portfolio of products comprises Friedreich Ataxia, a monogenic, autosomal recessive, progressive multi-system disease that affects organ systems dependent on mitochondrial function, eventually leading to neurological, cardiac, and metabolic dysfunction; and Myotonic Dystrophy Type-1 (DM1), a dominantly-inherited, monogenic progressive neuromuscular disease affecting skeletal muscle, heart, brain, and other organs. It is also developing GeneTAC product candidate portfolio for the treatment of other nucleotide repeat expansion-driven monogenic diseases, such as Fragile X syndrome, spinocerebellar ataxias, amyotrophic lateral sclerosis, frontotemporal dementia, Huntington disease, and spinobulbar muscular atrophy. Design Therapeutics, Inc. was incorporated in 2017 and is headquartered in Carlsbad, California.

How the Company Makes Money

Design Therapeutics makes money primarily through the development and eventual commercialization of its therapeutic products. The company invests in research and development to advance its small-molecule therapies through clinical trials, with the goal of obtaining regulatory approval. Revenue is generated from potential future product sales, licensing agreements, and strategic partnerships. These collaborations may involve upfront payments, milestone payments, and royalties based on sales of approved products. Additionally, the company may receive funding from grants or other financial support aimed at advancing its research initiatives.

Design Therapeutics Financial Statement Overview

Summary

Design Therapeutics faces significant financial challenges, primarily due to its inability to generate revenue. While the balance sheet shows a strong cash position and low debt, the persistent losses and negative cash flows present substantial risks. Achieving revenue growth and improving operational efficiency are crucial for future financial health.

Income Statement

Design Therapeutics shows no revenue generation over recent years, leading to negative profitability metrics. The company consistently reports operating losses, reflected by negative EBIT and net income. The absence of revenue growth and persistent negative margins indicate significant challenges in achieving profitability.

Balance Sheet

The company maintains a healthy equity position with low debt, as evidenced by a favorable debt-to-equity ratio. However, continuous operating losses have eroded equity over time. The high equity ratio is a positive sign of financial stability, but the lack of revenue generation poses a risk to long-term sustainability.

Cash Flow

Operating cash flow remains negative, mirroring the income statement's lack of profitability. Free cash flow is also negative, which could indicate difficulties in covering operational expenses. Nonetheless, the company has sufficient cash reserves, providing some buffer against cash flow shortages in the short term.

Breakdown
Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement		Total Revenue
0.00	0.00	0.00	0.00	226.00
	Gross Profit
0.00	-537.00K	-466.00K	-129.00K	-4.77K
	EBIT
-62.38M	-78.19M	-67.59M	-35.83M	-8.33M
	EBITDA
-62.38M	-66.33M	-62.84M	-35.70M	-8.32M
	Net Income Common Stockholders
-49.59M	-66.86M	-58.62M	-35.53M	-8.28M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
245.48M	281.80M	330.39M	384.06M	36.09M
	Total Assets
252.09M	289.64M	341.14M	390.56M	36.52M
	Total Debt
1.53M	3.05M	3.69M	3.63M	0.00
	Net Debt
-21.03M	-18.15M	-22.81M	-294.94M	-2.38M
	Total Liabilities
10.00M	11.96M	13.83M	8.43M	47.83M
	Stockholders Equity
242.10M	277.69M	327.31M	382.13M	-11.31M
Cash Flow		Free Cash Flow
-43.45M	-58.82M	-52.23M	-30.91M	-8.74M
	Operating Cash Flow
-43.10M	-58.56M	-51.32M	-29.38M	-8.67M
	Investing Cash Flow
43.95M	52.54M	-220.99M	-53.64M	-33.56M
	Financing Cash Flow
513.00K	724.00K	235.00	379.21K	44.53M

Design Therapeutics Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 3.96
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Negative
• RSI: Neutral
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For DSGN, the sentiment is Negative. The current price of 3.96 is above the 20-day moving average (MA) of 3.53, below the 50-day MA of 4.22, and below the 200-day MA of 4.99, indicating a neutral trend. The MACD of -0.19 indicates Negative momentum. The RSI at 55.96 is Neutral, neither overbought nor oversold. The STOCH value of 92.51 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for DSGN.

Design Therapeutics Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
Sector *	51 Neutral	$5.20B	3.26	-40.34%	2.93%	17.68%	1.94%
TERN	45 Neutral	$244.43M	―	-29.56%	―	―	10.98%
FHTX	39 Underperform	$235.80M	―	322.49%	―	-33.83%	27.89%
FDMT	39 Underperform	$157.43M	―	-25.95%	―	―	―
ANNX	38 Underperform	$193.09M	―	-50.84%	―	―	43.21%
DSGN	36 Underperform	$224.78M	―	-19.08%	―	―	26.63%
NGNE	28 Underperform	$197.24M	―	-30.28%	―	―	-140.77%

Design Therapeutics Corporate Events

Design Therapeutics Updates Corporate Presentation for Investors

Design Therapeutics, Inc. has updated its corporate presentation to be used in meetings with investors, analysts, and others, which has been attached to a Current Report on Form 8-K. This update, although furnished for informational purposes, is not deemed filed under the Securities Exchange Act or the Securities Act, thus limiting its formal legal implications.