Prime Medicine, Inc. (PRME) AI Stock Analysis

• Market Cap: $640.81M
• Dividend Yield: N/A
• Average Volume (3M): 4.15M
• Price to Earnings (P/E): ―
• Beta (1Y): 3.03
• Revenue Growth: 647.13%
• EPS Growth: 26.79%
• Country: US
• Employees: 214
• Sector: Healthcare
• Sector Strength: 45
• Industry: Biotechnology
• EPS (TTM): -0.32
• Shares Outstanding: 180,510,650
• 10 Day Avg. Volume: 3,946,859
• 30 Day Avg. Volume: 4,146,985
• PEG Ratio: 0.07
• Price to Book (P/B): 2.26
• Price to Sales (P/S): 116.10
• P/FCF Ratio: -2.66
• Enterprise Value/Market Cap: 1.24
• Enterprise Value/Revenue: 132.85
• Enterprise Value/Gross Profit: -19.91
• Enterprise Value/Ebitda: -4.11
• 1Y Price Target: $6.08
• Price Target Upside: 71.27% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 5
• EPS Forecast (FY): -1.26
• Revenue Forecast (FY): $5.23M

• Rating: 43 Neutral
• Price Target: ―

Prime Medicine, Inc. faces significant financial hurdles with ongoing losses and dependency on external funding. While recent technical indicators show potential for recovery, the stock remains under pressure. The promising preclinical results offer a positive long-term outlook, but the current valuation and financial performance weigh heavily on the overall score.

Positive Factors

Promising Preclinical Results

The successful preclinical results for the AATD program demonstrate Prime Medicine's potential to advance in gene-editing therapies, enhancing its competitive position in the biotechnology sector and potentially leading to significant future revenue streams.

Revenue Growth

Although starting from a low base, the notable revenue growth indicates Prime Medicine's increasing ability to monetize its technology, which could enhance its financial stability and attract further partnerships.

Liquidity Buffer

Maintaining a liquidity buffer through cash and short-term investments provides Prime Medicine with the financial flexibility to continue its R&D efforts and manage operational expenses, supporting long-term strategic goals.

Negative Factors

Operational Losses

Consistent operational losses undermine Prime Medicine's profitability and could limit its ability to invest in future growth opportunities, posing a risk to long-term sustainability if not addressed.

Reliance on External Funding

Dependence on external funding through equity financing exposes Prime Medicine to risks if market conditions change, potentially affecting its ability to sustain operations and invest in R&D.

Negative Cash Flows

Negative cash flows highlight inefficiencies in converting revenue to cash, which can strain resources and limit the company's ability to fund ongoing operations and strategic initiatives without additional financing.

Prime Medicine, Inc. Business Overview & Revenue Model

Company Description

Prime Medicine, Inc., a biotechnology company, delivers genetic therapies to address diseases by deploying gene editing technology. It offers Prime Editors with a Prime Editor protein, comprising a fusion between a Cas protein and a reverse transcriptase enzyme; and a pegRNA, which targets the Prime Editor to a specific genomic location and provides a template for making the desired edit to the target DNA sequence. The company was incorporated in 2019 and is headquartered in Cambridge, Massachusetts.

How the Company Makes Money

Prime Medicine, Inc. generates revenue through several key streams. The primary source of income is likely derived from licensing agreements and partnerships with pharmaceutical and biotechnology companies interested in accessing Prime Medicine's proprietary gene-editing technology. These collaborations may involve upfront payments, milestone payments based on the progress of research and development efforts, and royalties on any commercialized products developed using their technology. Additionally, the company might receive funding from grants or government programs focused on advancing genetic research. Strategic partnerships with research institutions and healthcare organizations also contribute to its revenue model by facilitating the development and potential commercialization of new therapies.

Prime Medicine, Inc. Financial Statement Overview

Summary

Prime Medicine, Inc. operates with substantial financial challenges, including significant operational losses and negative cash flows. While revenue growth is stagnant, the company maintains a liquidity buffer through cash and short-term investments. However, it heavily relies on equity financing to cover deficits, posing risks if external funding becomes scarce.

Income Statement

Prime Medicine, Inc. has shown minimal revenue generation with a slight increase in 2024. Gross profit margin is technically 100% due to revenue equaling gross profit, but the company remains unprofitable with a significant negative net income. The EBIT and EBITDA margins are negative, reflecting substantial operational losses. The revenue growth from 2023 to 2024 is notable but starts from a zero base, thus not impactful.

Balance Sheet

The company maintains a moderate debt-to-equity ratio, benefiting from equity financing. However, the equity ratio indicates a reliance on liabilities to fund assets. The return on equity is concerning due to consistent net losses, undermining shareholder value. Despite these challenges, the cash and short-term investments provide a liquidity buffer.

Cash Flow

Prime Medicine's cash flow situation is strained, with negative operating and free cash flows. The free cash flow has improved slightly year-over-year but remains negative, indicating cash burn. The operating cash flow to net income ratio highlights inefficiencies in converting revenue to cash. Positive financing cash flow suggests reliance on external funding to sustain operations.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	5.98M	2.98M	0.00	0.00	0.00	5.21M
Gross Profit	-39.88M	2.98M	0.00	0.00	0.00	2.23M
EBITDA	-193.41M	-196.34M	-186.64M	-114.32M	-83.91M	-889.00K
Net Income	-197.34M	-195.88M	-198.13M	-121.82M	-165.37M	-3.41M
Balance Sheet
Total Assets	385.01M	297.51M	193.85M	360.31M	301.86M	54.78M
Cash, Cash Equivalents and Short-Term Investments	208.43M	190.44M	121.67M	293.92M	269.62M	53.33M
Total Debt	118.14M	40.79M	13.63M	28.75M	10.41M	0.00
Total Liabilities	223.19M	144.36M	60.78M	44.04M	62.30M	21.31M
Stockholders Equity	161.82M	153.15M	133.07M	316.27M	239.56M	33.47M
Cash Flow
Free Cash Flow	-115.09M	-130.16M	-174.14M	-147.92M	-38.23M	-6.18M
Operating Cash Flow	-109.06M	-122.86M	-165.41M	-131.83M	-34.08M	-5.54M
Investing Cash Flow	-88.84M	68.46M	18.71M	-47.10M	-73.63M	-1.06M
Financing Cash Flow	150.95M	195.88M	655.00K	181.49M	269.28M	34.93M

Prime Medicine, Inc. Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 3.55
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For PRME, the sentiment is Negative. The current price of 3.55 is below the 20-day moving average (MA) of 4.74, below the 50-day MA of 4.99, and above the 200-day MA of 3.09, indicating a neutral trend. The MACD of -0.43 indicates Positive momentum. The RSI at 36.65 is Neutral, neither overbought nor oversold. The STOCH value of 12.06 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for PRME.

Prime Medicine, Inc. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
IMTX	56 Neutral	$1.30B	―	-17.34%	―	83.36%	22.27%
UPB	56 Neutral	$1.35B	-12.21	-40.80%	―	―	―
RLAY	52 Neutral	$1.18B	-3.52	-41.14%	―	-16.50%	33.02%
TSHA	52 Neutral	$1.19B	―	-64.93%	―	-36.36%	-945.72%
Sector *	51 Neutral	$7.86B	-0.30	-43.30%	2.27%	22.53%	-2.21%
PRME	43 Neutral	$640.81M	―	-112.34%	―	647.13%	26.79%
SANA	33 Underperform	$1.08B	―	-96.11%	―	―	31.16%

Prime Medicine, Inc. Corporate Events

Prime Medicine Advances AATD Program with Promising Preclinical Results

On March 18, 2025, Prime Medicine, Inc. announced a preclinical program for treating alpha-1 antitrypsin deficiency (AATD) using its universal liver lipid nanoparticle to edit the SERPINA1 gene mutation. Initial in vivo data showed promising results with up to 72% precise correction of the gene in humanized mice, restoring over 95% of serum AAT to normal levels. The company plans to advance the AATD program through lead optimization and aims to file an investigational new drug application by mid-2026, indicating significant progress in its liver franchise and potential impact on treating both lung- and liver-associated diseases.