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Harrow Health Inc (HROW)
NASDAQ:HROW
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Harrow Health
(NASDAQ:HROW)
50Neutral
Positive Factors
Financial Performance
Preliminary revenues of $65M-$67M beat our estimate of $58.6M and consensus of $58.4M.
Market Strategy
Management expects 2025 revenue to exceed $280M, which would represent a growth rate over 40%.
Product Launch
Harrow launched VEVYE Access for All, a program that guarantees access to VEVYE eye drops for eligible patients and health plans, potentially accelerating market adoption.
Negative Factors
Filing Concerns
A delayed 10-K filing is often a cause for concern; in this case, we take management’s reasoning at face value as the incoming auditor requires additional time.
Regulatory and Market Risks
Risks include lower-than-projected market uptake of products, inability to develop and secure regulatory approval of pipeline products, inability to acquire new products, inability to service $216M outstanding debt, and potential dilution risk.
Harrow Health (HROW) vs. S&P 500 (SPY)
Market Cap
$934.50M
Dividend YieldN/A
Average Volume (3M)559.07K
Price to Earnings (P/E)―
Beta (1Y)1.96
Revenue Growth53.32%
EPS Growth33.82%
CountryUS
Employees315
SectorHealthcare
Sector Strength71
IndustryDrug Manufacturers - Specialty & Generic
Share Statistics
EPS (TTM)-0.49
Shares Outstanding35,654,170
10 Day Avg. Volume912,534
30 Day Avg. Volume559,074
Financial Highlights & Ratios
PEG RatioN/A
Price to Book (P/B)N/A
Price to Sales (P/S)5.98
Price to Cash Flow (P/CF)85.70
P/FCF Ratio107.50
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
$56.00Price Target Upside113.66% Upside
Rating ConsensusStrong Buy
Number of Analyst Covering3
Harrow Health Business Overview & Revenue Model
Company DescriptionHarrow Health, Inc. operates as an ophthalmic-focused healthcare company. The company owns ImprimisRx, an ophthalmology outsourcing and pharmaceutical compounding business; and DEXYCU for the treatment of post-operative inflammation. The company also holds equity interests in Surface Ophthalmics, Inc., a clinical-stage pharmaceutical company that focuses on development and commercialization of therapeutics for ocular surface diseases; Melt Pharmaceuticals, Inc., a clinical-stage pharmaceutical company that focused on the development and commercialization of proprietary non-intravenous, sedation, and anesthesia therapeutics for human medical procedures in hospital, outpatient, and in-office settings; and Eton Pharmaceuticals, Inc., a commercial-stage pharmaceutical company that engages in developing and commercializing drug products. Harrow Health, Inc. owns royalty rights in four clinical stage drug candidates being developed by Surface Ophthalmics, Inc. and Melt Pharmaceuticals, Inc. The company was formerly known as Imprimis Pharmaceuticals, Inc. and changed its name to Harrow Health, Inc. in December 2018. Harrow Health, Inc. was incorporated in 2006 and is headquartered in San Diego, California.
How the Company Makes MoneyHarrow Health generates revenue through the sale of its ophthalmic pharmaceutical products. The company manufactures and distributes a variety of eye care medications, which are sold to healthcare providers, clinics, and other medical institutions. In addition to direct sales, Harrow Health benefits from strategic partnerships and licensing agreements that expand its market reach and product offerings. The company also engages in research and development to continuously enhance its product line, aiming to meet the evolving needs of patients and healthcare professionals.
Harrow Health Financial Statement Overview
Summary
Harrow Health shows robust revenue growth and strong gross profit margins, but faces challenges with profitability and high leverage. The balance sheet indicates significant debt levels, potentially limiting financial flexibility. Improvements in cash flow management are positive, yet historical volatility and operational losses present ongoing challenges.Income Statement
Harrow Health shows a strong revenue growth trajectory with a significant increase from $88.6 million in 2022 to $169.1 million in TTM 2024. Gross profit margin remains robust at 72.6% in TTM. However, the company struggles with profitability, as evidenced by a negative net income and EBIT margin in TTM, indicating operational challenges.75
Positive
Balance Sheet
The balance sheet reveals a high debt-to-equity ratio, driven by significant total debt of $196.1 million versus equity of $57.98 million in TTM, signaling potential leverage risks. The equity ratio is relatively low at 16.5%, suggesting limited financial cushioning. However, the company has managed to maintain cash reserves of $72.6 million.60
Neutral
Cash Flow
There is a positive turnaround in free cash flow from -$148.7 million in 2023 to $3 million in TTM 2024, indicating improved cash flow management. The operating cash flow to net income ratio is positive, demonstrating some operational cash generation despite negative net income. Nonetheless, the historical volatility in free cash flow poses a risk.65
Positive
| Breakdown | |||||
| TTM | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 | Dec 2019 |
|---|---|---|---|---|---|
| Income Statement | Total Revenue | ||||
| 169.14M | 130.19M | 88.59M | 72.48M | 48.87M | 51.16M | Gross Profit |
| 122.73M | 90.55M | 63.21M | 54.26M | 34.41M | 34.42M | EBIT |
| -8.57M | 431.00K | -1.75M | -284.00K | -1.63M | -503.00K | EBITDA |
| 878.00K | 9.72M | -3.20M | -10.14M | 3.49M | 1.44M | Net Income Common Stockholders |
| -33.41M | -24.41M | -14.09M | -18.01M | -3.42M | -2.59M |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | ||||
| 28.06M | 82.77M | 96.27M | 50.67M | 32.56M | 29.95M | Total Assets |
| 49.45M | 312.16M | 157.02M | 98.33M | 57.47M | 59.09M | Total Debt |
| 15.25M | 190.50M | 104.17M | 77.96M | 23.53M | 20.99M | Net Debt |
| 8.61M | 116.42M | 7.90M | 35.79M | 19.43M | 16.24M | Total Liabilities |
| 24.70M | 241.75M | 130.14M | 87.40M | 30.65M | 31.67M | Stockholders Equity |
| 24.75M | 70.77M | 27.24M | 11.29M | 27.18M | 27.71M |
| Cash Flow | Free Cash Flow | ||||
| 3.03M | -148.71M | -6.07M | -23.43M | -2.09M | -887.00K | Operating Cash Flow |
| 4.27M | 3.84M | 1.71M | 5.08M | -1.10M | 950.00K | Investing Cash Flow |
| 4.19M | -152.55M | -1.74M | -18.69M | -981.00K | -1.83M | Financing Cash Flow |
| -1.48M | 126.53M | 54.14M | 51.47M | 1.43M | -1.01M |
Harrow Health Technical Analysis
Negative
26.21
Price Trends
28.96
Negative
34.30
Negative
35.10
Negative
Market Momentum
-0.22
Negative
45.57
Neutral
42.69
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For HROW, the sentiment is Negative. The current price of 26.21 is above the 20-day moving average (MA) of 25.74, below the 50-day MA of 28.96, and below the 200-day MA of 35.10, indicating a neutral trend. The MACD of -0.22 indicates Negative momentum. The RSI at 45.57 is Neutral, neither overbought nor oversold. The STOCH value of 42.69 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for HROW.
Harrow Health Risk Analysis
Harrow Health disclosed 58 risk factors in its most recent earnings report. Harrow Health reported the most risks in the “Finance & Corporate” category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Harrow Health Peers Comparison
Overall Rating
UnderperformOutperform
Sector (49)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
54 Neutral | $1.21B | ― | -95.21% | ― | 9.03% | -25.00% | |
50 Neutral | $934.50M | ― | -24.97% | ― | 53.32% | 33.82% | |
49 Neutral | $6.85B | 0.81 | -52.91% | 2.50% | 19.94% | 1.20% | |
48 Neutral | $400.69M | ― | -43.42% | ― | -5.97% | -25.87% | |
45 Neutral | $72.05M | ― | 91.63% | ― | -79.77% | 10.85% | |
44 Neutral | $139.54M | ― | -336.97% | ― | 167.28% | -34.13% | |
41 Neutral | $13.14M | ― | -58.71% | ― | -79.66% | -141.87% |
* Healthcare Sector Average
Performance Comparison
HROW
Harrow Health
26.21
13.41
104.77%
PRPH
Prophase Labs
0.44
-6.41
-93.58%
EYPT
EyePoint Pharmaceuticals
5.83
-14.44
-71.24%
OCUL
Ocular Therapeutix
7.58
-1.11
-12.77%
CLSD
Clearside Biomedical
0.95
-0.63
-39.87%
SCPH
scPharmaceuticals
2.78
-2.07
-42.68%
Harrow Health Earnings Call Summary
Earnings Call Date: Mar 27, 2025 | % Change Since: -5.96% | Next Earnings Date: May 19, 2025
Earnings Call Sentiment Positive
The earnings call highlighted strong revenue growth and strategic product launches, particularly with VEVYE and the retina pivot strategy. However, inventory issues with VEVYE and seasonal impacts on revenue were noted as challenges.Highlights
Record Revenue Growth
Harrow reported record revenue of $49.3 million, a 44% increase over the prior year quarter, indicating strong growth.
VEVYE Prescription Success
VEVYE prescription volume increased by 55% in the third quarter compared to the second quarter, with a refill rate of over 90%.
Operational Improvements and New Product Launches
Implemented the 'retina pivot' strategy, focusing on the retina specialist community, which is already showing benefits. TRIESENCE was successfully relaunched in October.
Lowlights
Inventory Challenges for VEVYE
A temporary inventory shortage of VEVYE led to capped revenue potential in the third quarter.
Q3 Seasonality Impact
Summer seasonality affected surgical scheduling, traditionally causing a weaker third quarter.
Company Guidance
During the third quarter of 2024, Harrow reported record revenue of $49.3 million, marking a 44% increase from the prior year and a small increase over the previous quarter. The company's key product, VEVYE, experienced a 55% increase in prescription volume compared to the second quarter, despite facing an inventory shortage. VEVYE's refill rate is impressive, with over 90% of patients refilling their prescriptions. IHEEZO saw a 15% sequential rise in unit demand from the second quarter and an 82% reorder rate. The company made a strategic decision to focus on the retina specialist community, which is expected to bolster IHEEZO's performance. Additionally, TRIESENCE was relaunched in October, with positive initial responses, particularly regarding reimbursement. Harrow's commercial team expanded the number of covered territories for VEVYE from 51 to 61, contributing to its growth trajectory.Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.