LENZ Therapeutics (LENZ) AI Stock Analysis

• Market Cap: $816.24M
• Dividend Yield: N/A
• Average Volume (3M): 222.44K
• Price to Earnings (P/E): ―
• Beta (1Y): 0.67
• Revenue Growth: N/A
• EPS Growth: 68.93%
• Country: US
• Employees: 6
• Sector: Healthcare
• Sector Strength: 59
• Industry: Biotechnology
• EPS (TTM): -0.53
• Shares Outstanding: 28,146,154
• 10 Day Avg. Volume: 333,700
• 30 Day Avg. Volume: 222,443
• PEG Ratio: -0.43
• Price to Book (P/B): 3.41
• Price to Sales (P/S): 0.00
• P/FCF Ratio: -11.80
• 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: $47.14
• Price Target Upside: 62.55% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 8

• Rating: 46 Neutral
• Price Target: ―

LENZ Therapeutics is navigating significant financial challenges with ongoing losses and negative cash flows, underscoring the need for strategic improvement to achieve profitability. While the earnings call highlights positive regulatory and commercial developments, the stock is burdened by a weak valuation profile due to negative earnings. The technical analysis presents a neutral to slightly bearish outlook, which, combined with financial hurdles, results in a cautious overall score.

Positive Factors

Product Efficacy

The Phase II and Phase III studies of LNZ100 showed impressive efficacy with high response rates and daylong durability, enhancing confidence in the product's market success.

Regulatory Approval

The FDA's review of LNZ100 is progressing smoothly with no delays or interruptions, indicating a positive outlook for approval.

Strategic Partnerships

Lenz announced an exclusive licensing agreement with Lotus Pharmaceuticals, enabling the commercialization of LNZ100 in Southeast Asia, which could expand market reach and revenue potential.

Negative Factors

Financial Risks

While Lenz expects to have $190 million in cash, unforeseen expenses or delays could impact financial stability before reaching positive operating cash flow post-launch.

Market Competition

Despite the strong product profile of LNZ100, the potential market may face challenges due to competition and existing alternatives for presbyopia treatment.

LENZ Therapeutics Business Overview & Revenue Model

Company Description

LENZ Therapeutics, Inc., a biopharmaceutical company, focuses on developing and commercializing therapies to improve vision in the United States. Its product candidates include LNZ100 and LNZ101 which are in Phase III clinical trials for the treatment of presbyopia. The company is headquartered in Del Mar, California.

How the Company Makes Money

LENZ Therapeutics makes money primarily through the development and commercialization of its pharmaceutical products designed to treat eye diseases. The company generates revenue by advancing its drug candidates through clinical trials, obtaining regulatory approvals, and subsequently marketing these drugs to healthcare providers and patients. Additionally, LENZ may engage in strategic partnerships or licensing agreements with other pharmaceutical companies, which can provide upfront payments, milestone payments, and royalties based on product sales. These collaborations can significantly contribute to the company's earnings, allowing LENZ to leverage external resources and market reach while focusing on its core research and development activities.

LENZ Therapeutics Financial Statement Overview

Summary

LENZ Therapeutics exhibits significant financial challenges, reflected in persistent losses and negative cash flows. Despite a strong equity position and minimal leverage, the firm's operational difficulties are evident in its income and cash flow statements. The biotechnology industry is inherently high-risk, and LENZ's current financial trajectory highlights the need for strategic pivots to achieve profitability and sustainable growth. Investors should be cautious, considering the ongoing financial instability and liquidity risks.

Income Statement

The income statement reflects a challenging financial landscape for LENZ Therapeutics, as evidenced by consistent net losses and negative EBIT and EBITDA over multiple reporting periods. The absence of total revenue in recent periods signifies a lack of operational income, while net income remains negative, indicating sustained unprofitability. The firm's gross profit margin is also negative, further highlighting financial difficulties. These factors collectively illustrate significant financial hurdles.

Balance Sheet

LENZ Therapeutics shows a strong equity position, with stockholders' equity accounting for a significant portion of its total assets, resulting in a healthy equity ratio. The debt-to-equity ratio is low, indicating minimal leverage and financial risk. While the company maintains substantial cash reserves, the consistent negative net income affects the return on equity. Overall, the balance sheet displays financial stability but is challenged by profitability concerns.

Cash Flow

The cash flow statement reveals significant cash outflows from operating activities, indicating operational challenges. Although financing activities have provided cash inflows, these are not yet translating into positive free cash flow or net income. The negative free cash flow growth rate suggests ongoing operational cash demands, while the operating cash flow to net income ratio reflects insufficient cash generation relative to net losses. These factors underscore liquidity concerns and the need for improved cash management.

Breakdown
TTM	Dec 2023	Dec 2022	Dec 2021	Dec 2020	Dec 2019
Income Statement		Total Revenue
0.00	0.00	15.00M	0.00	0.00	0.00
	Gross Profit
-33.00K	-2.41M	6.65M	-734.00K	-121.00K	0.00
	EBIT
-58.61M	-73.11M	-105.64M	-60.44M	-13.50M	-29.00K
	EBITDA
-58.55M	-122.24M	-97.29M	-70.03M	-68.21M	-29.00K
	Net Income Common Stockholders
-49.77M	-124.65M	-101.05M	-70.76M	-68.37M	-109.00K
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
19.82M	185.86M	268.23M	376.98M	19.82M	6.00K
	Total Assets
22.56M	188.46M	321.90M	401.99M	22.56M	6.00K
	Total Debt
0.00	362.00K	5.79M	0.00	0.00	2.21M
	Net Debt
-19.82M	-185.50M	-41.94M	-376.98M	-19.82M	2.20M
	Total Liabilities
32.36M	4.87M	25.61M	12.14M	32.36M	2.22M
	Stockholders Equity
-9.80M	183.58M	296.29M	389.84M	-9.80M	-2.22M
Cash Flow		Free Cash Flow
-59.86M	-100.86M	-94.57M	-58.59M	-10.27M	-19.00K
	Operating Cash Flow
-59.39M	-90.01M	-87.98M	-52.85M	-8.72M	-19.00K
	Investing Cash Flow
-154.48M	226.35M	-241.86M	-5.74M	-1.54M	0.00
	Financing Cash Flow
199.00M	190.00K	597.00K	417.47M	30.08M	0.00

LENZ Therapeutics Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 29.00
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For LENZ, the sentiment is Positive. The current price of 29 is below the 20-day moving average (MA) of 29.18, above the 50-day MA of 26.76, and above the 200-day MA of 26.79, indicating a neutral trend. The MACD of 0.71 indicates Positive momentum. The RSI at 51.01 is Neutral, neither overbought nor oversold. The STOCH value of 31.09 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for LENZ.

LENZ Therapeutics Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
Sector *	54 Neutral	$5.38B	3.27	-45.10%	3.30%	16.81%	0.02%
IMNM	49 Neutral	$851.85M	―	-69.21%	―	-13.76%	57.73%
BCAX	48 Neutral	$630.98M	―	34.94%	―	―	―
LENZ	46 Neutral	$816.24M	―	-24.47%	―	―	68.93%
PRTA	42 Neutral	$273.44M	―	-23.46%	―	54.55%	36.41%
REPL	42 Neutral	$753.91M	―	-62.58%	―	―	4.28%
RCKT	40 Underperform	$330.76M	―	-60.45%	―	―	6.99%

LENZ Therapeutics Corporate Events

LENZ Therapeutics Hosts Commercial Day for LNZ100

LENZ Therapeutics is hosting a Commercial Day on April 15, 2025, to provide updates on the potential approval and launch of LNZ100. The event will cover commercialization strategies, supply chain readiness, and insights from Key Opinion Leaders and Eye Care Professionals.

Spark’s Take on LENZ Stock

According to Spark, TipRanks’ AI Analyst, LENZ is a Underperform.

LENZ Therapeutics faces significant financial challenges with persistent losses and negative cash flows, despite a strong equity position. The negative P/E ratio and lack of dividend suggest a high-risk valuation. Technical indicators further highlight bearish sentiment. However, positive strides in regulatory progress and a promising future outlook from the earnings call provide some optimism. Investors should weigh these risks against potential long-term rewards.

To see Spark’s full report on LENZ stock, click here.