Sol-Gel Technologies (SLGL) AI Stock Analysis

• Market Cap: $203.28M
• Dividend Yield: N/A
• Average Volume (3M): 16.66K
• Price to Earnings (P/E): ―
• Beta (1Y): 1.80
• Revenue Growth: 62.04%
• EPS Growth: 6.10%
• Country: US
• Employees: 34
• Sector: Healthcare
• Sector Strength: 45
• Industry: Biotechnology
• EPS (TTM): -2.13
• Shares Outstanding: 2,785,787
• 10 Day Avg. Volume: 26,975
• 30 Day Avg. Volume: 16,656
• PEG Ratio: -0.04
• Price to Book (P/B): 5.15
• Price to Sales (P/S): 6.06
• P/FCF Ratio: 426.90
• Enterprise Value/Market Cap: 0.95
• Enterprise Value/Revenue: 29.46
• Enterprise Value/Gross Profit: -19.20
• Enterprise Value/Ebitda: -11.76
• 1Y Price Target: $110.00
• Price Target Upside: 50.75% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 1
• EPS Forecast (FY): -6.81
• Revenue Forecast (FY): $5.30M

• Rating: 51 Neutral
• Price Target: $73.00 ▲(0.04% Upside)
• Action: Reiterated Date: 03/21/26
• Date: Action: Reiterated 03/21/26

The score is driven primarily by improving financial trajectory (strong 2025 revenue rebound, positive operating/free cash flow, and very low debt) tempered by continued losses and equity erosion. Technicals are mixed/neutral, and valuation is pressured by a negative P/E and no dividend yield.

Positive Factors

Proprietary Drug Delivery Platform

A proprietary sol-gel delivery platform represents a durable competitive asset in specialty dermatology: it can enable differentiated product profiles, support premium product economics, and be licensed to partners. Over months this underpins recurring royalty and collaboration optionality.

Low Financial Leverage

Very low debt provides financial flexibility to fund R&D or commercialization through near-term cash generation or modest financing without heavy interest burden. This conservatively financed balance sheet reduces solvency risk over the next several quarters.

2025 Revenue/Cash Flow Inflection

A strong 2025 revenue rebound with product-level economics that produced near full gross profit and positive operating/free cash flow signals an inflection toward self-sustaining operations. If sustained, this materially lowers funding risk and supports organic growth investments.

Negative Factors

Ongoing Net Losses and Equity Erosion

Cumulative losses and a shrinking equity base constrain long-term financial flexibility: recurring net losses erode capital, limit capacity for sustained R&D or commercial investment, and increase the likelihood of dilution or dependence on external financing over months.

Margin Volatility

Historical swings to deeply negative gross profit indicate unstable product economics or cost/revenue recognition irregularities. Persistent margin volatility makes forecasting cash generation and achieving durable profitability more difficult for investors and management over the medium term.

Limited Commercial Scale / Partner Reliance

A small internal commercial footprint and reliance on licensing/collaborations limit scaling speed and increase revenue variability tied to partner execution. Over months this can constrain market penetration and delay realization of milestone/royalty streams.

Sol-Gel Technologies Business Overview & Revenue Model

Company Description

Sol-Gel Technologies Ltd., a clinical stage specialty pharmaceutical company, focuses on developing and commercializing topical dermatological drug products based on its proprietary microencapsulation delivery system in Israel. The company's lead product candidates include Twyneo, a novel, once-daily, non-antibiotic topical cream which has completed Phase III clinical trials for the treatment of acne vulgaris; Epsolay, a once-daily topical cream that has completed Phase III clinical trials for the treatment of papulopustular rosacea; SGT-210, which is in Phase I clinical trial for the treatment of palmoplantar keratoderma; and Erlotinib, Tapinarof, and roflumilast to treat psoriasis and other medical conditions. It is also involved in the development of generic topical dermatological drug products. The company has collaboration with Perrigo. Sol-Gel Technologies Ltd. was incorporated in 1997 and is headquartered in Ness Ziona, Israel.

How the Company Makes Money

Sol-Gel makes money primarily through (1) net product sales from its own dermatology products where it is responsible for commercialization in its licensed territories, and (2) collaboration and license arrangements in which a partner commercializes a product and Sol-Gel earns payments tied to that relationship. Under its collaboration/licensing model, revenue can include upfront or option-related payments (if applicable under a given contract), milestone payments triggered by regulatory approvals or commercial events, and ongoing royalties calculated as a percentage of a partner’s net sales in the licensed territory. Under its direct commercialization model, revenue is recognized from sales to customers (typically through wholesalers/specialty distributors in the U.S. pharmaceutical channel), net of customary deductions such as rebates, chargebacks, returns, and other allowances. To a lesser extent, the company may generate revenue from providing development-related services or other contract-related reimbursements when specified by an agreement; if not specified in publicly available disclosures, this revenue stream is null.

Sol-Gel Technologies Financial Statement Overview

Summary

Results show a meaningful 2025 improvement (revenue rebound and modestly positive operating/free cash flow) and very low leverage, but profitability remains weak with continued operating and net losses and a shrinking equity base from cumulative losses.

Income Statement

Revenue rebounded sharply in 2025 ($19.4M; ~196% growth vs. 2024) after a weak 2023–2024 period, and gross profit in 2025 was nearly equal to revenue, suggesting strong product-level economics. However, profitability remains challenged: the company is still loss-making in 2025 (net loss ~$6.1M, EBIT loss ~$7.6M), following sizable losses in 2022–2024 and extreme margin volatility (including deeply negative gross profit in 2022–2023). Overall, the top-line trajectory improved, but earnings consistency and margin stability are still weak.

Balance Sheet

Leverage is low, with total debt under ~$1.0M in 2025 and historically low debt relative to equity (debt-to-equity around ~2%–5% in 2021–2024). That said, the equity base has been shrinking over time (from ~$55.6M in 2021 to ~$22.8M in 2025), reflecting cumulative losses, and returns on equity are negative in most years (including 2025). The balance sheet looks conservatively financed, but ongoing losses are eroding capital.

Cash Flow

Cash flow quality improved meaningfully in 2025, with positive operating cash flow (~$0.3M) and positive free cash flow (~$0.3M), a sharp reversal from heavy cash burn in 2022–2024 (operating cash flow roughly -$9.5M to -$17.7M annually). Still, the history of large negative operating and free cash flow (including 2020–2021) highlights funding risk if profitability doesn’t continue improving, and the 2025 improvement needs to be sustained to be considered durable.

Breakdown	TTM	Dec 2025	Dec 2024	Dec 2023	Dec 2022	Dec 2021
Income Statement
Total Revenue	6.56M	19.39M	11.54M	1.55M	3.88M	31.27M
Gross Profit	-10.07M	19.28M	11.30M	-21.99M	-8.80M	10.89M
EBITDA	-16.43M	-7.48M	-10.35M	-28.96M	-15.68M	3.84M
Net Income	-14.91M	-6.13M	-10.58M	-27.24M	-14.92M	3.22M
Balance Sheet
Total Assets	42.01M	29.92M	35.85M	45.29M	46.63M	69.19M
Cash, Cash Equivalents and Short-Term Investments	30.47M	24.00M	23.93M	38.00M	33.63M	43.24M
Total Debt	1.39M	991.00K	1.31M	1.65M	772.00K	1.59M
Total Liabilities	7.10M	7.11M	7.00M	6.64M	4.42M	13.60M
Stockholders Equity	34.90M	22.81M	28.85M	38.64M	42.21M	55.59M
Cash Flow
Free Cash Flow	0.00	275.00K	-13.89M	-17.86M	-9.65M	-7.83M
Operating Cash Flow	0.00	322.00K	-13.89M	-17.73M	-9.48M	-7.69M
Investing Cash Flow	0.00	-8.58M	26.69M	-9.74M	1.70M	19.87M
Financing Cash Flow	0.00	6.00K	0.00	21.81M	15.00K	837.00K

Sol-Gel Technologies Technical Analysis

• Technical Analysis Sentiment: Neutral
• Last Price: 72.97
• 50DMA: Negative
• 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 SLGL, the sentiment is Neutral. The current price of 72.97 is below the 20-day moving average (MA) of 85.06, below the 50-day MA of 73.77, and above the 200-day MA of 38.04, indicating a neutral trend. The MACD of 1.14 indicates Positive momentum. The RSI at 44.76 is Neutral, neither overbought nor oversold. The STOCH value of 26.41 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for SLGL.

Sol-Gel Technologies Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
OVID	58 Neutral	$345.51M	-6.90	-23.98%	―	946.61%	-11.30%
Sector *	51 Neutral	$7.86B	-0.30	-43.30%	2.27%	22.53%	-2.21%
SLGL	51 Neutral	$203.28M	-19.16	-33.61%	―	62.04%	6.10%
IMDX	51 Neutral	$136.95M	-2.45	-9999.00%	―	520.87%	36.11%
STTK	50 Neutral	$445.13M	-7.52	-65.03%	―	-84.46%	33.32%
SRZN	50 Neutral	$215.57M	-0.39	―	―	-63.96%	-28.50%
MGX	47 Neutral	$53.42M	-0.69	-40.87%	―	-43.88%	4.73%