Evotec AG (EVO) AI Stock Analysis

• Market Cap: $1.29B
• Dividend Yield: N/A
• Average Volume (3M): 105.72K
• Price to Earnings (P/E): ―
• Beta (1Y): 0.92
• Revenue Growth: N/A
• EPS Growth: N/A
• Country: US
• Employees: 4,740
• Sector: Healthcare
• Sector Strength: 66
• Industry: Drug Manufacturers - Specialty & Generic
• EPS (TTM): -0.52
• Shares Outstanding: 355,527,040
• 10 Day Avg. Volume: 105,110
• 30 Day Avg. Volume: 105,722
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): 1.46
• Price to Cash Flow (P/CF): N/A
• 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: $7.50
• Price Target Upside: 109.50% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 2

Evotec AG faces significant challenges due to declining revenues and operational inefficiencies, impacting its financial performance and valuation. Efforts to improve cash management and strategic initiatives are positive, but market uncertainties and technical indicators suggest a cautious outlook.

Positive Factors

Collaborations

An extension of collaboration with Bristol Myers Squibb on targeted protein degradation into indications outside of oncology triggered $50M payment.

Cost Efficiency

The company completed the first two steps by closing multiple sites to improve cost efficacy, which delivered annualized recurring gross savings of €40M, and completed the strategic review to 'rebuild' the business model.

Revenue Growth

Guidance of 5-10% revenue growth in 2025 is encouraging.

Negative Factors

Facility Investments

Ongoing investments to bring the Toulouse facility fully online will likely offset some of the gains from JEB growth.

Macroeconomic Headwinds

Underwhelming Q3 revs of €184.9M driven by shared R&D still seeing macro headwinds.

R&D Revenues

Pharma funding uncertainties impacted demand, resulting in lighter Shared R&D revenues.

Evotec AG Business Overview & Revenue Model

Company Description

Evotec SE operates as drug discovery and development partner for the pharmaceutical and biotechnology industry worldwide. The company is developing pharmaceutical products in various therapeutic areas, such as diabetes and complications of diabetes, fibrosis, infectious diseases, CNS diseases, oncology, pain and inflammation, immunology, rare diseases, respiratory diseases, and women's health. It has collaboration agreements with Bayer AG; Lilly; Chinook Therapeutics; Novo Nordisk A/S; Galapagos; Pfizer Inc.; CONBA Pharmaceutical Co., Ltd.; Bristol Myers Squibb Company; Zhejiang JingXin Pharmaceutical Co., Ltd; Kazia Therapeutics; Apeiron Biologics; and Takeda Pharmaceuticals. The company was formerly known as Evotec AG and changed its name to Evotec SE in April 2019. Evotec SE was incorporated in 1993 and is headquartered in Hamburg, Germany.

How the Company Makes Money

Evotec AG generates revenue primarily through its drug discovery alliances and service agreements with pharmaceutical and biotechnology companies. The company employs a collaborative business model that includes milestones and royalty payments linked to the successful development and commercialization of partnered products. Additionally, Evotec earns revenue from its proprietary drug discovery projects and research funding from governmental and non-governmental organizations. Strategic partnerships and long-term collaborations with industry leaders also significantly contribute to its revenue streams.

Evotec AG Financial Statement Overview

Summary

Evotec AG's financial performance is mixed. The company lacks debt and has a strong equity base, providing stability. However, declining revenue, profitability issues, and cash flow challenges significantly impact the financial outlook.

Income Statement

Evotec AG has experienced volatility in its financial performance. The company showed a decline in revenue from the previous year, with a current TTM revenue of $777.05 million compared to $781.43 million in 2023, indicating a small negative revenue growth rate. The gross profit margin has also decreased from 22.40% to 13.70%, suggesting pressure on cost management. Additionally, the company is currently operating at a net loss, with a net profit margin of -22.06% in TTM, compared to -10.74% in 2023. EBIT and EBITDA margins have also declined, reflecting operational challenges.

Balance Sheet

Evotec AG maintains a strong equity position with a stockholders' equity of $968.47 million against total assets of $1.99 billion, resulting in a solid equity ratio of 48.64% for TTM. The company's debt-to-equity ratio is favorable at 0, indicating no current debt burden, which provides financial stability. However, the return on equity is negative due to losses, highlighting profitability challenges.

Cash Flow

The company's cash flow situation presents a mixed picture. Free cash flow has worsened, with a significant negative figure of -$209.45 million in TTM compared to -$179.56 million in 2023, indicating challenges in generating cash flows from operations and capital expenditures. Operating cash flow to net income ratio is negative, reflecting cash flow difficulties despite the absence of debt.

Breakdown
TTM	Dec 2023	Dec 2022	Dec 2021	Dec 2020	Dec 2019
Income Statement		Total Revenue
777.05M	781.43M	751.45M	618.03M	500.92M	446.44M
	Gross Profit
106.45M	175.05M	174.06M	151.54M	125.74M	132.89M
	EBIT
-183.14M	-47.51M	12.49M	27.32M	48.52M	62.59M
	EBITDA
-175.82M	24.13M	-86.08M	298.41M	75.50M	86.77M
	Net Income Common Stockholders
-171.37M	-83.91M	-175.66M	215.51M	6.28M	38.16M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
53.99M	604.11M	729.98M	858.50M	492.22M	321.66M
	Total Assets
144.53M	2.25B	2.26B	2.24B	1.46B	1.18B
	Total Debt
13.00M	626.20M	506.67M	512.92M	491.96M	463.10M
	Net Debt
-11.84M	115.29M	91.52M	-186.41M	69.80M	186.06M
	Total Liabilities
31.32M	1.13B	1.07B	857.48M	740.05M	703.88M
	Stockholders Equity
112.56M	1.12B	1.19B	1.38B	722.85M	477.03M
Cash Flow		Free Cash Flow
-209.45M	-179.56M	21.75M	3.29M	-54.35M	10.31M
	Operating Cash Flow
-38.37M	36.44M	203.11M	122.24M	44.72M	42.22M
	Investing Cash Flow
-125.87M	-13.29M	-415.82M	-243.85M	-155.09M	-86.63M
	Financing Cash Flow
-101.04M	71.96M	-52.41M	398.43M	246.41M	211.26M

Evotec AG Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 3.58
• 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 EVO, the sentiment is Negative. The current price of 3.58 is above the 20-day moving average (MA) of 3.30, below the 50-day MA of 3.74, and below the 200-day MA of 4.02, indicating a neutral trend. The MACD of -0.07 indicates Negative momentum. The RSI at 55.39 is Neutral, neither overbought nor oversold. The STOCH value of 80.33 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for EVO.

Evotec AG Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
COLL	74 Outperform	$867.88M	14.62	32.62%	―	11.41%	45.89%
AMPH	70 Outperform	$1.11B	7.62	23.26%	―	13.59%	15.72%
PCRX	65 Neutral	$1.20B	―	-12.08%	―	3.85%	-339.15%
ANIP	65 Neutral	$1.47B	―	-4.86%	―	26.20%	-219.22%
Sector *	51 Neutral	$5.19B	3.13	-40.94%	2.95%	17.94%	2.00%
EVO	50 Neutral	$1.29B	―	-16.21%	―	―	―
HROW	44 Neutral	$828.60M	―	-24.97%	―	53.32%	33.82%