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Knight Therapeutics (TSE:GUD)
TSX:GUD
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Knight Therapeutics
(TSX:GUD)
70Outperform
Positive Factors
Contracts
Revenues are expected to be higher due to Knight re-signing a $22.4M contract with the Brazilian Ministry of Health.
Earnings
Knight reported 4Q-2024 results that beat estimates.
Negative Factors
Profitability
EBITDA margin was lower despite the revenue growth.
Knight Therapeutics (GUD) vs. S&P 500 (SPY)
Market Cap
$601.09M
Dividend YieldN/A
Average Volume (3M)80.92K
Price to Earnings (P/E)137.3
Beta (1Y)0.19
Revenue Growth13.13%
EPS GrowthN/A
CountryCA
Employees725
SectorHealthcare
Sector Strength64
IndustryPharmaceuticals
Share Statistics
EPS (TTM)0.04
Shares Outstanding99,517,670
10 Day Avg. Volume115,950
30 Day Avg. Volume80,925
Financial Highlights & Ratios
PEG RatioN/A
Price to Book (P/B)N/A
Price to Sales (P/S)1.79
Price to Cash Flow (P/CF)31.20
P/FCF Ratio48.30
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
C$7.88Price Target Upside30.51% Upside
Rating ConsensusStrong Buy
Number of Analyst Covering6
Knight Therapeutics Business Overview & Revenue Model
Company DescriptionKnight Therapeutics Inc. (GUD) is a Canadian-based specialty pharmaceutical company focused on acquiring, in-licensing, and commercializing innovative pharmaceutical products for the Canadian and select international markets. The company operates in the healthcare sector, offering a portfolio of prescription and over-the-counter medicines that address unmet medical needs.
How the Company Makes MoneyKnight Therapeutics generates revenue primarily through the sale of its pharmaceutical products. The company acquires and in-licenses innovative drugs and medical products, subsequently managing their regulatory approval, marketing, and distribution within targeted markets. Key revenue streams include the sales of branded and specialty pharmaceuticals, leveraging partnerships with other pharmaceutical companies to expand its product offerings. Knight Therapeutics' earnings are significantly influenced by its ability to successfully commercialize its portfolio and establish strategic partnerships to enhance market reach and product accessibility.
Knight Therapeutics Financial Statement Overview
Summary
Knight Therapeutics shows a mixed financial picture. Revenue growth is positive, but profitability is challenged by consistent net losses. The balance sheet is stable with low leverage, but declining free cash flow and negative net income are concerns. Improvements in cost management and operational efficiency are needed.Income Statement
The company has shown revenue growth with a 6.23% increase from the previous year. However, profitability metrics such as the net profit margin and EBIT margin are concerning, with a negative net income of -$30.73M for the TTM period. Gross profit margin for the TTM is 38.59%, which indicates some ability to cover the cost of goods sold but is not translating into net profits.45
Neutral
Balance Sheet
The balance sheet reflects a strong equity base with a debt-to-equity ratio of 0.08, indicating low leverage. The equity ratio stands at 80.42%, suggesting financial stability. However, the return on equity is negative due to the net loss, limiting the overall effectiveness of the equity.65
Positive
Cash Flow
Free cash flow has decreased from the previous year, with a negative free cash flow growth rate of -53.9%. However, the operating cash flow to net income ratio is positive, indicating that operating cash flow is robust relative to the net loss. The company demonstrates some ability to generate cash from operations despite profitability challenges.55
Neutral
| Breakdown | |||||
| TTM | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 | Dec 2019 |
|---|---|---|---|---|---|
| Income Statement | Total Revenue | ||||
| 348.64M | 328.20M | 293.56M | 243.48M | 199.52M | 47.46M | Gross Profit |
| 134.61M | 152.65M | 138.06M | 115.41M | 81.69M | 26.92M | EBIT |
| 10.33M | -2.89M | -2.40M | -5.32M | -3.44M | 13.99M | EBITDA |
| 30.98M | 40.90M | 25.26M | 42.59M | 67.56M | 27.16M | Net Income Common Stockholders |
| -30.73M | -16.84M | -29.89M | 15.68M | 31.76M | 14.52M |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | ||||
| 703.82M | 154.42M | 191.22M | 162.99M | 411.34M | 430.62M | Total Assets |
| 1.05B | 945.49M | 1.05B | 991.89M | 1.04B | 1.31B | Total Debt |
| 0.00 | 69.09M | 77.70M | 40.96M | 56.19M | 62.18M | Net Debt |
| -244.78M | 10.33M | 6.02M | -45.01M | -173.40M | -107.09M | Total Liabilities |
| 21.80M | 198.62M | 228.98M | 149.87M | 153.44M | 390.20M | Stockholders Equity |
| 1.03B | 746.87M | 825.86M | 842.02M | 886.24M | 810.73M |
| Cash Flow | Free Cash Flow | ||||
| 11.98M | 25.98M | 14.66M | -179.56M | -32.87M | 1.65M | Operating Cash Flow |
| 43.06M | 35.94M | 40.48M | 44.62M | -12.21M | 4.60M | Investing Cash Flow |
| -7.37M | 29.34M | -63.08M | -105.28M | 101.35M | -11.86M | Financing Cash Flow |
| -43.10M | -81.00M | 1.76M | -78.31M | -29.23M | -62.80M |
Knight Therapeutics Technical Analysis
Positive
6.04
Price Trends
5.70
Positive
5.51
Positive
5.61
Positive
Market Momentum
0.14
Negative
56.49
Neutral
37.12
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TSE:GUD, the sentiment is Positive. The current price of 6.04 is above the 20-day moving average (MA) of 5.83, above the 50-day MA of 5.70, and above the 200-day MA of 5.61, indicating a bullish trend. The MACD of 0.14 indicates Negative momentum. The RSI at 56.49 is Neutral, neither overbought nor oversold. The STOCH value of 37.12 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for TSE:GUD.
Knight Therapeutics Peers Comparison
Overall Rating
UnderperformOutperform
Sector (49)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
71 Outperform | C$370.10M | ― | -3.15% | 4.51% | -15.41% | -69.47% | |
70 Outperform | $601.09M | 137.27 | 0.53% | ― | 13.13% | ― | |
70 Outperform | C$59.50M | 29.93 | 6.85% | ― | 2.72% | -47.79% | |
52 Neutral | C$137.03M | ― | -23.20% | ― | -8.80% | 26.77% | |
49 Neutral | $6.86B | 0.72 | -52.93% | 2.49% | 20.83% | 1.11% |
* Healthcare Sector Average
Performance Comparison
TSE:GUD
Knight Therapeutics
6.00
0.70
13.21%
TSE:HLS
HLS Therapeutics Inc
4.52
0.52
13.00%
TSE:NEO
Neo Performance Materials Inc
8.81
2.82
47.08%
TSE:MBX
Microbix Biosystms
0.44
0.08
22.22%
Knight Therapeutics Earnings Call Summary
Earnings Call Date: Mar 20, 2025 | % Change Since: -3.36% | Next Earnings Date: May 8, 2025
Earnings Call Sentiment Neutral
Knight Therapeutics reported record revenues and significant pipeline expansion but faced challenges with declining gross margins, decreased adjusted EBITDA, and competition from generic products. The acquisition of Paladin and new contracts in Brazil are positive, but these are offset by currency and hyperinflation challenges.Highlights
Record-Breaking Revenue and Growth
Knight Therapeutics delivered 11 years of consecutive record high revenues, achieving over $365 million in revenue and approximately $58 million in adjusted EBITDA for 2024. The promoted portfolio grew by 16% over the prior year period and has delivered a three-year CAGR of more than 30%.
Pipeline Expansion
Significant progress was made in expanding the pipeline with five new products. The company now has a pipeline of 18 products expected to generate peak sales of over $150 million.
Regulatory Approvals
Obtained several regulatory approvals, including Minjuvi and TAVALISSE in Mexico and Jornay PM in Canada. Also launched two products in Canada, Bijuva and Imvexxy.
Acquisition of Paladin
Entered into an agreement to acquire all assets of Paladin, adding a portfolio of stable cash flow-generating products, with expected revenues of $70 million for 2024.
New MOH Contract in Brazil
Signed a new contract for AmBisome with the Ministry of Health in Brazil, expecting to deliver approximately $22.4 million in 2025.
Lowlights
Gross Margin Decline
Reported a gross margin of 47% for 2024, a decrease from 48% last year, due to product mix.
Adjusted EBITDA Decrease
Adjusted EBITDA decreased by $2 million or 4% compared to last year, with adjusted EBITDA per share remaining relatively unchanged.
Challenges from Generic Competition
Generic competition in Brazil impacted the sales of Lenvima, with legal actions ongoing but expected to have no impact on the market.
Impact of Foreign Exchange and Hyperinflation
Impact of Latin American currency depreciation and hyperinflation in Argentina affected financial results.
Company Guidance
During Knight Therapeutics' Fourth Quarter 2024 conference call on March 20, 2025, significant guidance was provided for fiscal 2025. The company anticipates revenue between $390 million to $405 million and expects adjusted EBITDA to be approximately 13% of revenues. This forecast assumes the successful mid-2025 closure of the Paladin transaction, which is expected to add $70 million in revenue and includes an upfront payment of $100 million plus $20 million for inventory. Knight's 2024 financial results showcased record high revenues exceeding $365 million and an adjusted EBITDA of about $58 million. The promoted portfolio, comprising 75% of total revenues, grew by 16% over the previous year, with a three-year CAGR exceeding 30%. The company also expanded its pipeline with five new products and secured several regulatory submissions and approvals, expecting these developments to generate peak sales of over $150 million. Knight's ongoing product launches and growth investments are aimed at maintaining its strong performance trajectory.Knight Therapeutics Corporate Events
Product-Related AnnouncementsStock BuybackFinancial Disclosures
Knight Therapeutics Achieves Record Revenues and Expands Product Approvals
Positive
Mar 20, 2025
Knight Therapeutics reported record-high revenues for the fourth quarter and year-end 2024, with a 13% increase driven by the growth of key promoted products and the impact of hyperinflation in Argentina. The company achieved significant corporate developments, including launching a Normal Course Issuer Bid (NCIB) and obtaining regulatory approvals for several products in Latin America and Canada, which strengthens its market position and product portfolio.
M&A TransactionsBusiness Operations and Strategy
Knight Therapeutics to Acquire Paladin Pharma for $120 Million
Positive
Mar 11, 2025
Knight Therapeutics Inc. has announced the acquisition of Paladin Pharma Inc. from Endo Operations Limited for $120 million, with potential future payments contingent on sales milestones. This strategic acquisition is expected to enhance Knight’s Canadian business and provide a stable cash flow to support growth in Canada and Latin America, pending regulatory approvals expected by mid-2025.
Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.