Merus (MRUS) AI Stock Analysis

• Market Cap: $5.06B
• Dividend Yield: N/A
• Average Volume (3M): 658.07K
• Price to Earnings (P/E): ―
• Beta (1Y): 0.99
• Revenue Growth: 59.77%
• EPS Growth: -92.92%
• Country: US
• Employees: 260
• Sector: Healthcare
• Sector Strength: 47
• Industry: Biotechnology
• EPS (TTM): -2.23
• Shares Outstanding: 75,634,360
• 10 Day Avg. Volume: 568,179
• 30 Day Avg. Volume: 658,072
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): N/A
• P/FCF Ratio: N/A
• Enterprise Value/Market Cap: 0.60
• Enterprise Value/Revenue: 54.07
• Enterprise Value/Gross Profit: 54.07
• Enterprise Value/Ebitda: -7.84
• 1Y Price Target: $91.91
• Price Target Upside: 36.61% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 14

• Rating: 62 Neutral
• Price Target: $71.00 ▲(5.53% Upside)

Merus's overall stock score is driven by strong technical indicators and positive corporate events, which are offset by weak financial performance and valuation metrics. The stock shows bullish momentum and has strengthened its financial position through a public offering, but ongoing losses and negative cash flows remain significant risks.

Positive Factors

Clinical Data

Initial petosemtamab data in colorectal cancer and one or two Phase 3 readouts in Head and Neck Cancer offer significant potential upside for the stock.

Financial Position

The strong ~$900MM cash position should provide runway.

Regulatory Approval

Petosemtamab's potential approval via accelerated approval pathway in r/m Head and Neck Squamous Carcinoma could lead to significant stock upside.

Negative Factors

Clinical Concerns

The initial Phase I dose escalation study with petosemtamab showed no responses, which could be concerning for some investors.

Development Progress

There are no meaningful updates or changes to timelines in the earnings release, suggesting stagnation in progress.

Financial Performance

The 2Q25 EPS at -$2.23 came in significantly higher than consensus of -$1.16 based on higher than expected R&D (-$21.5M) and SG&A (-$3.2M).

Merus Business Overview & Revenue Model

Company Description

Merus N.V., a clinical-stage immuno-oncology company, engages in the discovery and development of bispecific antibody therapeutics in the Netherlands. Its bispecific antibody candidate pipeline includes Zenocutuzumab (MCLA-128), which is in a phase 2 clinical trials for the treatment of patients with metastatic breast cancer, as well as in Phase 1/2 clinical trials for the treatment of solid tumors that harbor Neuregulin 1. The company is also developing MCLA-158, which is in a phase I clinical trial for the treatment of solid tumors; MCLA-145, which is in phase 1 clinical trials for the treatment of solid tumors; MCLA-129, which is in phase 1/2 clinical trials for the treatment of patients with advanced non-small cell lung cancer and other solid tumors; and ONO-4685 that is Phase 1 clinical trial to treat relapsed/refractory T cell lymphoma. In addition, it has collaboration agreement with Betta Pharmaceuticals Co. Ltd for the research and development of stage bispecific antibody candidates include MCLA-129; and collaboration with Incyte Corporation for the development of MCLA-145. The company was incorporated in 2003 and is headquartered in Utrecht, the Netherlands.

How the Company Makes Money

Merus generates revenue primarily through partnerships and collaborations with larger pharmaceutical companies, which may involve upfront payments, milestone payments, and royalties on future sales of products developed from their technology. By entering into strategic alliances, Merus can share the financial risks associated with drug development while receiving funding to support its research initiatives. Additionally, the company may also generate revenue through grants and government funding aimed at supporting innovative cancer therapies. As Merus advances its clinical programs and moves closer to commercialization, it may also expect to generate revenue from product sales once its therapies receive regulatory approval.

Merus Financial Statement Overview

Summary

Merus shows revenue growth but struggles with profitability and cash flow. The company has a strong equity position but ongoing net losses and negative free cash flow highlight financial challenges.

Income Statement

Merus has shown inconsistent revenue growth, with a noticeable increase to $54.73M in TTM from $36.13M in the previous year. Despite this growth, the company consistently reports net losses, with a TTM net income margin of -506.74% and declining EBIT and EBITDA margins, indicating significant operational challenges and profitability issues.

Balance Sheet

The company maintains a strong equity position, with a high equity ratio of 81.55% in TTM, reflecting a stable capital structure. The debt-to-equity ratio is low at 0.30, indicating minimal leverage risk. However, ongoing net losses could erode equity over time if trends do not improve.

Cash Flow

Merus has experienced negative free cash flow growth, with TTM free cash flow at -$239.68M. The operating cash flow to net income ratio is negative, reflecting cash flow challenges. While financing cash flow remains positive, the reliance on external funding could pose sustainability concerns.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	56.23M	36.13M	43.95M	41.59M	49.11M	29.94M
Gross Profit	56.23M	36.13M	43.95M	29.60M	-37.16M	-27.39M
EBITDA	-387.89M	-269.60M	-154.01M	-148.26M	-77.75M	-60.93M
Net Income	-385.52M	-215.33M	-154.94M	-131.19M	-66.82M	-85.51M
Balance Sheet
Total Assets	980.18M	785.13M	455.49M	376.54M	456.60M	231.22M
Cash, Cash Equivalents and Short-Term Investments	710.22M	537.03M	355.18M	290.23M	410.43M	207.75M
Total Debt	11.00M	9.91M	12.16M	13.47M	3.75M	3.95M
Total Liabilities	138.44M	134.77M	99.15M	129.49M	140.40M	128.95M
Stockholders Equity	841.74M	647.93M	356.34M	247.06M	316.20M	102.26M
Cash Flow
Free Cash Flow	-313.32M	-187.50M	-146.19M	-157.54M	-60.50M	-81.19M
Operating Cash Flow	-313.08M	-185.84M	-142.21M	-149.90M	-59.63M	-79.90M
Investing Cash Flow	-227.59M	-220.22M	-27.02M	2.80M	-146.62M	-1.49M
Financing Cash Flow	358.98M	494.01M	230.09M	58.74M	281.95M	39.52M

Merus Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 67.28
• 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 MRUS, the sentiment is Positive. The current price of 67.28 is above the 20-day moving average (MA) of 65.84, above the 50-day MA of 60.72, and above the 200-day MA of 48.81, indicating a bullish trend. The MACD of 1.48 indicates Positive momentum. The RSI at 59.09 is Neutral, neither overbought nor oversold. The STOCH value of 72.01 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for MRUS.

Merus Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
KRYS	75 Outperform	$4.25B	29.88	15.61%	―	116.09%	35.29%
RNA	63 Neutral	$6.05B	―	-37.76%	―	1.23%	-20.45%
MRUS	62 Neutral	$5.06B	―	-48.54%	―	59.77%	-92.92%
AKRO	60 Neutral	$3.85B	―	-31.14%	―	―	-11.39%
PTCT	58 Neutral	$3.93B	7.14	33.08%	―	96.00%	―
ZLAB	54 Neutral	$3.79B	―	-28.39%	―	32.56%	33.33%
Sector *	51 Neutral	$7.83B	-0.18	-40.10%	2.29%	21.46%	-2.03%

Merus Corporate Events

Merus Announces Public Offering of Common Shares

On June 3, 2025, Merus N.V. entered into an underwriting agreement with several underwriters for a public offering of 5,263,158 common shares at $57.00 per share, expected to close around June 5, 2025. The company anticipates net proceeds of approximately $281.7 million, which will be used to fund operations into 2028, advance clinical development, and support corporate purposes, enhancing its financial stability and market position.

The most recent analyst rating on (MRUS) stock is a Buy with a $67.00 price target. To see the full list of analyst forecasts on Merus stock, see the MRUS Stock Forecast page.

Merus Announces Promising Phase 2 Trial Results

On May 22, 2025, Merus announced interim clinical data from a phase 2 trial of its bispecific antibody, petosemtamab, in combination with pembrolizumab. The trial showed promising results with a 63% overall response rate among 43 evaluable patients, including complete and partial responses across various cancer types and PD-L1 levels. The treatment was generally well tolerated, with no significant overlapping toxicities observed. The company plans to potentially share top line interim results of phase 3 trials in 2026.

The most recent analyst rating on (MRUS) stock is a Buy with a $67.00 price target. To see the full list of analyst forecasts on Merus stock, see the MRUS Stock Forecast page.

Merus Shareholders Approve Key Proposals at AGM

On May 21, 2025, Merus N.V. held its annual general meeting of shareholders, with 89.20% of the company’s outstanding common shares represented. During the meeting, shareholders approved several proposals, including the adoption of the 2024 annual accounts, the appointment of KPMG as the external auditor for 2025, and the re-appointment of Anand Mehra, M.D. and Maxine Gowen, Ph.D. as non-executive directors. These decisions are expected to influence the company’s governance and operational strategies in the coming years.

The most recent analyst rating on (MRUS) stock is a Buy with a $67.00 price target. To see the full list of analyst forecasts on Merus stock, see the MRUS Stock Forecast page.