Rezolute (RZLT) AI Stock Analysis

• Market Cap: $174.95M
• Dividend Yield: N/A
• Average Volume (3M): 474.09K
• Price to Earnings (P/E): ―
• Beta (1Y): 0.09
• Revenue Growth: N/A
• EPS Growth: -10.43%
• Country: US
• Employees: 59
• Sector: Healthcare
• Sector Strength: 66
• Industry: Biotechnology
• EPS (TTM): -1.22
• Shares Outstanding: 60,535,423
• 10 Day Avg. Volume: 707,153
• 30 Day Avg. Volume: 474,088
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): N/A
• Price to Cash Flow (P/CF): -3.40
• P/FCF Ratio: 0.00
• 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: $12.60
• Price Target Upside: 361.54% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 5

Rezolute's stock faces hurdles with negative profitability and cash flow challenges, weighed down by weak technical indicators. However, promising clinical developments and regulatory advancements offer potential upside in the biotechnology space, partially offsetting current financial weaknesses.

Positive Factors

Clinical Trial Progress

The ongoing Ph3 study is set to begin U.S. patient enrollment after the FDA lifted a partial clinical hold, allowing for the inclusion of younger patients.

Financial Performance

Rezolute posted a loss per share of $0.22, narrower than the estimate of $0.25 loss per share.

Regulatory Approval

The Breakthrough Therapy designation for ersodetug (RZ358) reflects the FDA's recognition of its promising efficacy in treating hypoglycemia due to congenital hyperinsulinism.

Negative Factors

Market Challenges

The FDA used to have an age restriction for U.S. patients to be 12 years and older due to safety concerns, although the agency lifted such restriction.

Operational Costs

G&A expenses jumped 41.1% YoY to $4.5M, above the estimate of $4.1M, primarily due to an increase in professional fees and spending on increased headcount.

Rezolute Business Overview & Revenue Model

Company Description

Rezolute, Inc. (RZLT) is a clinical-stage biopharmaceutical company focused on developing therapies for metabolic and orphan diseases. The company is primarily engaged in the research and development of innovative treatments targeting serious conditions such as rare metabolic disorders. Its core product candidates include RZ358, an antibody designed to treat congenital hyperinsulinism, and RZ402, an oral therapy aimed at diabetic macular edema.

How the Company Makes Money

Rezolute generates revenue primarily through the development and potential commercialization of its proprietary drug candidates. The company aims to profit by advancing its products through clinical trials and obtaining regulatory approvals, leading to potential licensing agreements, partnerships, or direct sales. Revenues may also be supplemented by milestone payments or royalties from collaborations with larger pharmaceutical companies, which can provide financial support and distribution channels for their therapies. Currently, as a clinical-stage company, Rezolute may also rely on funding from investors, grants, and public offerings to support its research and development activities until its products reach the market.

Rezolute Financial Statement Overview

Summary

Rezolute faces significant challenges typical in biotechnology, with minimal revenue growth and substantial operational losses. Despite a strong equity position and low debt levels, the company struggles with negative cash flow and profitability, reflecting operational inefficiencies.

Income Statement

Rezolute's revenue growth has been minimal with minor revenue in TTM after years of none, reflecting limited commercial success. The company has negative profitability margins with a net profit margin of -122639.66% and an EBIT margin of -94665.52% in TTM, indicating high operational losses relative to revenue. There is no visible trend of improvement in profitability as both EBIT and net income have consistently been negative.

Balance Sheet

Rezolute shows a strong equity position with an equity ratio of 88.90% in TTM, indicating low financial leverage. The debt-to-equity ratio is minimal at 0.02, suggesting low debt levels relative to equity. However, the return on equity is negative at -71.44%, reflecting continued losses impacting shareholder returns.

Cash Flow

The company's free cash flow is negative, and the operating cash flow to net income ratio is 0.89, evidencing cash burn. However, financing activities have been a source of cash, indicating reliance on external funding. Free cash flow growth remains negative, reflecting operational inefficiencies.

Breakdown
TTM	Jun 2024	Jun 2023	Jun 2022	Jun 2021	Jun 2020
Income Statement		Total Revenue
58.00K	0.00	0.00	0.00	0.00	0.00
	Gross Profit
42.00K	-36.00K	-382.00K	-256.00K	-303.00K	-18.00K
	EBIT
-54.91M	-70.42M	-55.99M	-41.84M	-22.89M	-20.52M
	EBITDA
-73.18M	-68.42M	-51.41M	-41.83M	-22.88M	-20.32M
	Net Income Common Stockholders
-71.13M	-68.46M	-51.79M	-38.78M	-21.28M	-20.33M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
96.54M	126.87M	101.90M	150.41M	41.05M	9.96M
	Total Assets
112.01M	132.74M	123.72M	152.42M	42.61M	10.96M
	Total Debt
1.93M	2.23M	2.48M	188.00K	14.42M	410.00K
	Net Debt
-7.00M	-68.17M	-13.56M	-150.22M	-26.63M	-9.54M
	Total Liabilities
12.42M	11.73M	7.55M	2.95M	16.51M	3.60M
	Stockholders Equity
99.59M	121.00M	116.17M	149.47M	26.10M	7.37M
Cash Flow		Free Cash Flow
-63.44M	-57.37M	-44.63M	-39.62M	-20.44M	-24.17M
	Operating Cash Flow
-63.44M	-57.37M	-44.48M	-39.62M	-20.44M	-24.17M
	Investing Cash Flow
-9.61M	48.70M	-101.46M	0.00	0.00	0.00
	Financing Cash Flow
69.48M	63.03M	11.57M	148.98M	51.53M	22.55M

Rezolute Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 2.73
• 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 RZLT, the sentiment is Negative. The current price of 2.73 is below the 20-day moving average (MA) of 3.59, below the 50-day MA of 4.33, and below the 200-day MA of 4.68, indicating a bearish trend. The MACD of -0.43 indicates Positive momentum. The RSI at 20.30 is Positive, neither overbought nor oversold. The STOCH value of 8.10 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for RZLT.

Rezolute Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
RIGL	70 Outperform	$339.04M	19.53	531.78%	―	53.38%	―
ARDX	60 Neutral	$1.24B	―	-23.01%	―	168.06%	44.66%
Sector *	49 Neutral	$6.88B	0.82	-52.97%	2.48%	20.92%	1.17%
RZLT	48 Neutral	$174.95M	―	-74.36%	―	―	-10.43%
VTGN	42 Neutral	$80.53M	―	-46.28%	―	-33.00%	54.91%
VKTX	42 Neutral	$3.14B	―	-17.90%	―	―	-10.27%
APS	35 Underperform	C$10.18M	―	391.94%	―	―	60.95%

Rezolute Corporate Events

Rezolute Advances SunRIZE Study for Hypoglycemia Treatment

Rezolute, Inc. announced that outcomes from a Data Monitoring Committee (DMC) review of the open-label arm of its Phase 3 sunRIZE study showed that the targeted drug concentrations for ersodetug were safely reached in infants under one year old. This approval allows the enrollment of infants into the double-blind portion of the study, which aims to treat hypoglycemia due to congenital hyperinsulinism. The enrollment is expected to complete in the second quarter of 2025, with topline results anticipated by the end of the year. The interim analysis will guide the sample size adequacy and may adjust it to enhance statistical confidence.

Rezolute Highlights Promising Phase 2 Ersodetug Results

On January 10, 2025, Rezolute released a video showcasing a patient’s experience with their Phase 2 clinical study for the drug ersodetug, which is being explored as a treatment for hyperinsulinism. The patient, Paula, experienced improved quality of life and fewer hypoglycemic episodes while participating in the study. Rezolute is hopeful that ersodetug, now in a global Phase 3 trial, could significantly benefit many living with hyperinsulinism, although results for other patients may vary.

Rezolute Gains FDA Breakthrough Designation for Ersodetug

Rezolute, Inc. announced that the FDA has granted Breakthrough Therapy Designation to its drug, ersodetug, for treating hypoglycemia caused by congenital hyperinsulinism. This designation, based on significant data from the Phase 2b RIZE study, highlights ersodetug’s potential to substantially improve patient outcomes, reinforcing Rezolute’s position as a leader in addressing hyperinsulinism. The company is focused on completing the sunRIZE study and initiating a Phase 3 trial for tumor HI, with the FDA’s Orphan Drug Designation further supporting its innovative approach.