Galapagos (GLPG) AI Stock Analysis

• Market Cap: €1.64B
• Dividend Yield: N/A
• Average Volume (3M): 156.06K
• Price to Earnings (P/E): 20.0
• Beta (1Y): 0.72
• Revenue Growth: N/A
• EPS Growth: N/A
• Country: NL
• Employees: 704
• Sector: Healthcare
• Sector Strength: 55
• Industry: Biotechnology
• EPS (TTM): -2.35
• Shares Outstanding: 65,897,070
• 10 Day Avg. Volume: 88,615
• 30 Day Avg. Volume: 156,058
• PEG Ratio: -0.13
• Price to Book (P/B): 3.74
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 3.40
• 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: €22.50
• Price Target Upside: -9.57% Downside
• Rating Consensus: Moderate Sell
• Number of Analyst Covering: 3

• Rating: 48 Neutral
• Price Target: €23.50 ▼(-5.55%Downside)

Galapagos' stock score of 48 reflects its mixed financial performance, characterized by strong gross margins and a significant cash reserve but weighed down by ongoing operational losses and cash flow challenges. Technical analysis indicates moderate positive momentum, while valuation is weak due to the lack of profitability and no dividend yield.

Galapagos Business Overview & Revenue Model

Company Description

Galapagos NV, an integrated biopharmaceutical company, engages in the discovery, development, and commercialization of various medicines for high unmet medical need. Its pipeline products include filgotinib, a JAK1 inhibitor that is in various phases of clinical trials for the treatment of rheumatoid arthritis, Crohn's disease, ulcerative colitis, small bowel CD, fistulizing CD, ankylosing spondylitis, psoriatic arthritis, and uveitis. The company's pipeline products also comprise GLPG1972 that has completed Phase 2b trial for treating osteoarthritis; Toledo molecules, including GLPG3970, GLPG4399, and GLPG4876 for inflammation; and GLPG4716 and Ziritaxestat to treat idiopathic pulmonary fibrosis. In addition, its other pipeline products include GLPG2737, a cystic fibrosis transmembrane conductance regulator that is in Phase 2 clinical trials to treat patients with autosomal dominant polycystic kidney disease; and GLPG0555, a JAK1 inhibitor, which is in Phase 1b for treatment of patients with osteoarthritis. The company has collaboration agreements with Gilead Sciences, Inc.; AbbVie S.à r.l.; and Novartis Pharma AG. Galapagos NV was incorporated in 1999 and is headquartered in Mechelen, Belgium.

How the Company Makes Money

Galapagos makes money through the development and commercialization of pharmaceutical products. The company's revenue model primarily revolves around collaborations and licensing agreements with major pharmaceutical companies. These partnerships often include upfront payments, milestone payments, and royalties on sales of products that reach the market. Galapagos also invests significantly in its proprietary research and development efforts, aiming to bring its own drugs to market. The company's financial performance is heavily influenced by the success of its clinical trials, strategic partnerships, and the regulatory approval of its drug candidates.

Galapagos Financial Statement Overview

Summary

Galapagos shows mixed financial performance with strong gross margins and a robust cash reserve, yet faces significant challenges with operational losses and cash flow issues. The balance sheet suggests financial stability due to low leverage, but negative net income and cash flow inefficiencies are concerning.

Income Statement

Galapagos has experienced fluctuating revenues with a current TTM (Trailing-Twelve-Months) revenue of $288M, a slight increase from the previous year. However, the company continues to face significant challenges in achieving profitability, as evidenced by negative EBIT and net income margins. The gross profit margin remains strong at around 84%, indicating a high efficiency in managing production costs, but operating losses overshadow these strengths. Revenue growth is inconsistent, and the trend of negative net income poses a risk to financial stability.

Balance Sheet

The company's balance sheet shows a healthy equity ratio at approximately 68% and a low debt-to-equity ratio, reflecting financial stability and a conservative approach to leverage. However, there is a declining trend in stockholders' equity. Despite this, the cash position remains robust with over $3.2 billion in cash and equivalents, which provides a buffer against operational losses and financial flexibility.

Cash Flow

Galapagos faces challenges in cash flow management with consistent negative operating cash flow and free cash flow, indicative of cash burn issues. The company's free cash flow has seen some improvement, with a reduction in the negative figure over time. However, the operating cash flow to net income ratio is concerning, highlighting inefficiencies in converting income into cash flow.

Breakdown
TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement		Total Revenue
288.19M	275.65M	239.72M	505.28M	484.85M	478.05M
	Gross Profit
242.15M	240.79M	203.74M	493.20M	483.22M	-45.61M
	EBIT
-321.17M	-188.34M	-88.26M	-267.52M	-165.60M	-178.63M
	EBITDA
-183.06M	43.33M	44.23M	-33.37M	-100.93M	-294.52M
	Net Income Common Stockholders
-169.54M	74.08M	211.70M	-217.99M	-125.42M	-311.00M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
3.30B	3.12B	3.68B	4.09B	4.70B	5.16B
	Total Assets
4.02B	4.14B	4.36B	4.73B	5.19B	5.72B
	Total Debt
10.86M	11.72M	9.60M	21.90M	26.86M	29.44M
	Net Debt
-97.21M	-52.52M	-157.21M	-486.22M	-2.21B	-2.11B
	Total Liabilities
1.27B	1.24B	1.56B	2.21B	2.55B	3.05B
	Stockholders Equity
2.75B	2.90B	2.80B	2.53B	2.64B	2.67B
Cash Flow		Free Cash Flow
-312.39M	-402.14M	-425.24M	-537.49M	-561.71M	-518.65M
	Operating Cash Flow
-231.29M	-320.03M	-405.97M	-500.54M	-503.83M	-427.34M
	Investing Cash Flow
270.77M	220.60M	71.19M	-1.25B	541.24M	757.29M
	Financing Cash Flow
-4.77M	-4.92M	-5.00M	-1.49M	-3.88M	22.04M

Galapagos Technical Analysis

• Technical Analysis Sentiment: Neutral
• Last Price: 24.88
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Negative
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For NL:GLPG, the sentiment is Neutral. The current price of 24.88 is below the 20-day moving average (MA) of 25.25, above the 50-day MA of 23.66, and above the 200-day MA of 24.86, indicating a neutral trend. The MACD of 0.27 indicates Positive momentum. The RSI at 52.20 is Neutral, neither overbought nor oversold. The STOCH value of 31.56 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for NL:GLPG.

Galapagos Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
PHARM	61 Neutral	$706.16M	―	-6.31%	―	25.41%	-31.21%
Sector *	54 Neutral	$5.38B	3.31	-45.11%	3.29%	16.82%	0.04%
GLPG	48 Neutral	€1.64B	19.98	-6.36%	―	―	―