Mereo Biopharma Group Plc (MREO) AI Stock Analysis

• Market Cap: $61.16M
• Dividend Yield: N/A
• Average Volume (3M): 19.96M
• Price to Earnings (P/E): ―
• Beta (1Y): 1.39
• Revenue Growth: N/A
• EPS Growth: N/A
• Country: US
• Employees: 36
• Sector: Healthcare
• Sector Strength: 45
• Industry: Biotechnology
• EPS (TTM): -0.01
• Shares Outstanding: 159,131,700
• 10 Day Avg. Volume: 54,813,917
• 30 Day Avg. Volume: 19,961,262
• PEG Ratio: 0.12
• Price to Book (P/B): 8.49
• Price to Sales (P/S): 0.00
• P/FCF Ratio: -15.44
• Enterprise Value/Market Cap: 4.60
• Enterprise Value/Revenue: 562.55
• Enterprise Value/Gross Profit: 2.94K
• Enterprise Value/Ebitda: -6.47
• 1Y Price Target: $2.08
• Price Target Upside: 447.37% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 8
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 44 Neutral
• Price Target: $0.37 ▼(-2.11% Downside)

The score is driven primarily by weak financial performance (large losses and cash burn with minimal revenue) and very bearish technical signals (well below major moving averages with negative MACD). A negative Phase 3 trial update further pressures the outlook, while the low leverage balance sheet provides some offsetting support.

Positive Factors

Low leverage / solid equity

Very low debt and meaningful equity provide structural financial flexibility versus peers. This reduces near-term refinancing risk, supports continued R&D or selective partnering negotiations, and gives the company time to pursue value-extraction strategies without immediate solvency pressure.

Partnering-focused business model

A partnering-centric model de-risks capital requirements by enabling upfront, milestone and royalty structures. For a clinical-stage biotech, this increases probability of non-dilutive funding or asset monetization, allowing the company to advance programs without relying solely on product sales.

Positive BMD and safety readouts in Phase 3

Robust, statistically significant bone mineral density gains and a benign safety profile are durable scientific signals. They can underpin focused regulatory discussions, subgroup analyses, or attractive licensing pitches, preserving a pathway to extract value despite primary endpoint miss.

Negative Factors

Phase 3 primary endpoints missed

Failure to achieve primary fracture endpoints materially lowers approval and commercial prospects for setrusumab. This structurally reduces expected future revenues, weakens bargaining power with partners, and forces strategic reprioritization and resource reallocation across the pipeline.

High cash burn

Sustained negative operating and free cash flow at this scale relative to the balance sheet suggests meaningful runway pressure. Over months, continued burn will necessitate partnering, asset sales, or dilutive financing, which can materially alter strategy and ownership if not resolved.

Minimal revenue and large losses

Extremely low recurring revenue versus sizable net losses indicates limited internal cash generation capacity. Absent successful approvals or licensing, the company's earnings visibility is poor, increasing dependence on external funding and raising the risk of program cutbacks or dilution.

Mereo Biopharma Group Plc Business Overview & Revenue Model

Company Description

Mereo BioPharma Group plc, a biopharmaceutical company, develops and commercializes therapeutics for the treatment of oncology and rare diseases in the United Kingdom and internationally. Its lead product candidate, etigilimab (OMP-313M32), an antibody T-cell immunoreceptor with Ig and ITIM domains, which is in Phase 1b clinical trial for the treatment of tumor. The company is also developing Navicixizumab (OMP-305B83), which has completed Phase 1b clinical trials for the treatment of the late line ovarian cancer; Acumapimod (BCT-197), a p38 MAP kinase inhibitor that is in Phase II clinical trials to treat acute exacerbations of chronic obstructive pulmonary disease; and Leflutrozole (BGS-649), an oral aromatase inhibitor for the treatment of hypogonadotropic hypogonadism. In addition, it develops rare disease product candidates, including Setrusumab (BPS-804), a novel antibody for the treatment of osteogenesis imperfecta; and Alvelestat (MPH-966), an oral small molecule that is in Phase II clinical trial to treat Alpha-1 antitrypsin deficiency. The company has a collaboration with The University of Texas MD Anderson Cancer Center to evaluate anti-TIGIT therapeutic antibody candidate, etigilimab. Mereo BioPharma Group plc was incorporated in 2015 and is based in London, the United Kingdom.

How the Company Makes Money

Mereo BioPharma Group Plc primarily generates revenue through partnerships and collaborations with other pharmaceutical and biotechnology companies. These partnerships often involve licensing agreements, milestone payments, and royalties related to the development and commercialization of its drug candidates. Additionally, the company may receive funding from grants and research collaborations to support its R&D initiatives. By advancing its clinical-stage programs and successfully bringing its therapeutics to market, Mereo aims to create revenue streams through product sales and continued licensing arrangements.

Mereo Biopharma Group Plc Financial Statement Overview

Summary

Mereo Biopharma Group Plc's financial statements reflect a typical early-stage biotech profile with high R&D expenses and no revenue generation, leading to significant losses. The balance sheet shows some financial prudence with moderate leverage, and the strong cash position is essential for ongoing operations. However, persistent cash flow issues and negative profit margins pose challenges to long-term sustainability and profitability.

Income Statement

The income statement shows significant challenges with negative revenue growth, declining EBIT and EBITDA margins, and consistent net losses over the years. The gross profit margin is non-existent due to zero revenue in the latest year. The company faces substantial hurdles to profitability, which is common in early-stage biotech firms focusing on research and development.

Balance Sheet

The balance sheet indicates a reasonable equity position with a positive equity ratio and manageable debt levels. However, the debt-to-equity ratio has improved over the past year, suggesting cautious leverage management. The company's total assets decreased, which may affect its capacity to invest in future growth. Nonetheless, the financial stability offers a moderate foundation amidst operational challenges.

Cash Flow

Cash flow analysis reveals a negative free cash flow trend, indicating high cash burn typical for biotech firms in development phases. Operating cash flow remains negative, but there is a strong cash position due to past financing activities. The consistency in raising funds is a positive sign for liquidity, yet the dependency on external financing highlights operational sustainability concerns.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	500.00K	0.00	10.00M	0.00	49.21M	0.00
Gross Profit	95.54K	0.00	7.43M	257.44K	25.04M	-2.05M
EBITDA	-43.45M	-40.80M	-26.06M	-39.98M	25.49M	-203.41M
Net Income	-41.51M	-43.25M	-29.47M	-42.12M	17.17M	-209.83M
Balance Sheet
Total Assets	53.60M	76.39M	66.50M	77.41M	170.96M	86.08M
Cash, Cash Equivalents and Short-Term Investments	48.70M	69.80M	57.42M	68.18M	127.52M	32.09M
Total Debt	397.00K	6.43M	5.95M	15.37M	22.66M	24.53M
Total Liabilities	7.00M	15.42M	15.96M	26.01M	51.95M	106.55M
Stockholders Equity	46.60M	60.97M	50.54M	51.40M	119.01M	-20.47M
Cash Flow
Free Cash Flow	-33.03M	-33.53M	-21.55M	-48.83M	―	―
Operating Cash Flow	-32.71M	-32.83M	-21.13M	-48.82M	―	―
Investing Cash Flow	-20.00K	-699.00K	-419.00K	1.99M	―	2.04M
Financing Cash Flow	248.00K	46.15M	7.97M	200.00K	104.80M	47.34M

Mereo Biopharma Group Plc Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 0.38
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Positive
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For MREO, the sentiment is Negative. The current price of 0.38 is below the 20-day moving average (MA) of 1.46, below the 50-day MA of 1.71, and below the 200-day MA of 2.02, indicating a bearish trend. The MACD of -0.44 indicates Positive momentum. The RSI at 25.30 is Positive, neither overbought nor oversold. The STOCH value of 9.03 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for MREO.

Mereo Biopharma Group Plc Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
VNDA	60 Neutral	$433.77M	-5.13	-16.72%	―	11.12%	-406.76%
ABEO	60 Neutral	$275.83M	4.37	75.90%	―	―	―
CAPR	57 Neutral	$1.39B	-14.20	-107.79%	―	-52.08%	-69.35%
OMER	52 Neutral	$953.61M	-6.67	―	―	―	12.32%
Sector *	51 Neutral	$7.86B	-0.30	-43.30%	2.27%	22.53%	-2.21%
MREO	44 Neutral	$61.16M	-1.46	-69.98%	―	―	―

Mereo Biopharma Group Plc Corporate Events

Mereo Biopharma Updates Setrusumab Trials and Cost Controls

On December 29, 2025, Mereo BioPharma reported that its Phase 3 ORBIT and COSMIC trials of setrusumab (UX143) in pediatric and young adult patients with osteogenesis imperfecta did not meet their primary endpoints of statistically significant reduction in annualized clinical fracture rates versus placebo and bisphosphonates, respectively, although both studies showed strongly significant improvements in bone mineral density and no change in the safety profile. The company said it is conducting further analyses of the data, particularly in the higher-risk pediatric population where bone density gains were associated with a non-significant reduction in fractures, and in response to the outcome it is tightening cost controls, immediately reducing pre-commercial and manufacturing activities for setrusumab, and continuing efforts to extract value from its broader rare-disease portfolio, including ongoing partnering discussions for alvelestat.

The most recent analyst rating on (MREO) stock is a Buy with a $5.00 price target. To see the full list of analyst forecasts on Mereo Biopharma Group Plc stock, see the MREO Stock Forecast page.