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Knight Therapeutics (TSE:GUD)
TSX:GUD
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Knight Therapeutics (GUD) AI Stock Analysis

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TSE:GUD

Knight Therapeutics

(TSX:GUD)

Rating:61Neutral
Price Target:
C$6.50
▲(0.93% Upside)
Knight Therapeutics' overall stock score is driven by strong technical indicators and positive earnings call highlights, including revenue growth and business development. However, the high P/E ratio and concerns over profitability and cash flow weigh down the score.
Positive Factors
Acquisitions
Knight announced that it will acquire the Paladin business unit from Endo Inc., including $20M of inventory.
Company Performance
Knight Therapeutics reported a strong quarterly performance, beating estimates and increasing its guidance.
Product Launches
Knight Therapeutics plans to launch over 10 new drugs, expected to significantly increase revenue and gross margin.
Negative Factors
Currency and Inflation Effects
FX and hyperinflation skewed the topline results.
Operating Expenses
Adjusted EBITDA declined due to lower gross margins and increased selling, marketing, and administrative expenses.
Profit Margins
Gross margins have decreased, impacted by product mix changes and severance expenses related to manufacturing shifts.

Knight Therapeutics (GUD) vs. iShares MSCI Canada ETF (EWC)

Knight Therapeutics Business Overview & Revenue Model

Company DescriptionKnight Therapeutics Inc., a specialty pharmaceutical company, develops, acquires, in-licenses, out-licenses, markets, and distributes pharmaceutical and consumer health products, and medical devices in Canada, Latin America, and internationally. It offers Nerlynx for extended adjuvant breast cancer and metastatic breast cancer; Tafasitamab for relapsed or refractory diffuse large B-cell lymphoma; Pemigatinib to treat metastatic cholangiocarcinoma; Trelstar for advanced prostate cancer and for pain associated with endometriosis; Vidaza for myelodysplastic syndrome; Abraxane for metastatic pancreatic adenocarcinoma; Halaven for metastatic breast cancer and doft tissue sarcoma; and Lenvima for differentiated thyroid cancer, advanced renal cell cancer, and unresectable hepatocellular carcinoma. The company also provides Ladevina for multiple myeloma, myelodysplastic syndrome, mantle cell lymphoma, and follicular lymphoma; Zyvalix for metastatic prostate cancer; Karfib for relapsed or refractory multiple myeloma; Leprid for advanced prostate cancer; Rembre for chronic myeloid leukemia; Ambisome and Cresemba for fungal infection; Impavido for leishmaniasis; Exelon for mild to moderately severe dementia; and Ibsrela for the treatment of irritable bowel syndrome with constipation. In addition, it offers Salofalk for ulcerative colitis; Ursofalk to treat biliary cirrhosis; Imvexxy for moderate to severe dyspareunia; Bijuva for moderate to severe vasomotor symptoms associated with menopause in women with intact uteri; Fibridoner to treat idiopathic pulmonary fibrosis; Toliscrin DPI for pseudomonas aeruginosa lung infection in patients with cystic fibrosis; Toliscrin 1-2 for severe acute or resistant chronic infections; and Tobradosa Haler for chronic lung infections. Further, the company finances other life science companies; and invests in life sciences venture capital funds. Knight Therapeutics Inc. was incorporated in 2013 and is headquartered in Montreal, Canada.
How the Company Makes MoneyKnight Therapeutics generates revenue primarily through the commercialization of its pharmaceutical products, which includes both proprietary drugs and licensed products. The company's revenue model is based on sales of these products in the markets where they are available. Key revenue streams include direct sales to healthcare providers and pharmacies, as well as potential royalties and milestones from partnerships with other pharmaceutical companies. Significant partnerships with other biopharmaceutical firms enhance its product pipeline and market reach, contributing to the company's earnings. Additionally, Knight Therapeutics may also engage in licensing deals that provide upfront payments and ongoing royalties, further diversifying its revenue sources.

Knight Therapeutics Earnings Call Summary

Earnings Call Date:Aug 07, 2025
(Q2-2025)
|
% Change Since: |
Next Earnings Date:Nov 06, 2025
Earnings Call Sentiment Positive
The earnings call reflected strong revenue growth and positive business development, with significant additions to the product portfolio and an increased financial outlook. However, challenges such as a decline in gross margin, a net loss from investments, and increased operating expenses were noted.
Q2-2025 Updates
Positive Updates
Record High Adjusted Revenues
Knight Therapeutics achieved a record high adjusted revenues of CAD 197 million for the first half of 2025, driven by organic growth of 15% on a constant currency basis.
Strong Business Development
The company added over 50 products to its portfolio through Paladin and Sumitomo transactions, including five pipeline and early launch assets. Expanded agreements with Helsinn and Incyte added innovative pipeline products in oncology.
Significant Revenue Growth
Q2 2025 revenues were CAD 108.5 million, an increase of 15% compared to the same quarter last year. On a constant currency basis, revenues increased by 21%.
Increased Financial Outlook
Knight increased its fiscal 2025 revenue outlook to between CAD 410 million to CAD 420 million, up from CAD 390 million to CAD 405 million.
Revolving Credit Facility Secured
Knight secured a CAD 50 million revolving credit facility with National Bank and launched a syndication process to increase it to up to CAD 100 million, with an additional accordion of CAD 50 million.
Negative Updates
Gross Margin Decline
Gross margin decreased to 46% of adjusted revenue in Q2 2025 from 48% in the same period last year, mainly due to the product mix and severance costs related to facilities closure in Argentina.
Net Loss from Investments
Knight recorded a net loss of CAD 5.7 million in Q2, primarily due to mark-to-market revaluations of strategic fund investments.
Increased Operating Expenses
Operating expenses excluding amortization were CAD 38.4 million, an increase of 27% compared to the same period last year, driven by prelaunch and launch investments, and acquisition costs.
Company Guidance
During the Knight Therapeutics Second Quarter 2025 Results Conference Call, the company provided updated guidance for fiscal 2025, with expected revenues between CAD 410 million to CAD 420 million, up from the previous range of CAD 390 million to CAD 405 million. This increase is attributed to better-than-expected performance in the first half of the year and the addition of revenues from the Sumitomo transaction. The adjusted EBITDA is projected to remain at approximately 13% of revenues. Notably, for the first half of 2025, the company reported a record high adjusted revenue of CAD 197 million, driven by a 15% organic growth in their promoted product portfolio, and an adjusted EBITDA of CAD 27.6 million. In the second quarter alone, Knight delivered revenues of CAD 108.5 million, a 15% increase from the same quarter last year, with adjusted EBITDA reaching CAD 15.5 million or CAD 0.16 per share. Additionally, Knight has secured a $50 million revolving credit facility with National Bank and is in the process of expanding it to up to $100 million, with an additional accordion of $50 million, to support ongoing and future transactions.

Knight Therapeutics Financial Statement Overview

Summary
Knight Therapeutics shows stable revenue growth and a strong balance sheet with low leverage. However, profitability and cash flow generation are areas of concern, with declining margins and negative free cash flow growth. Improvements in operational efficiency and cash management are needed.
Income Statement
55
Neutral
Knight Therapeutics shows moderate revenue growth with a TTM increase of 3.16%. However, profitability is a concern, as indicated by a low net profit margin of 0.10% and negative EBIT margin. The gross profit margin remains stable at around 43%, but the declining EBITDA margin suggests pressure on operational efficiency.
Balance Sheet
70
Positive
The company maintains a strong balance sheet with a low debt-to-equity ratio of 0.14, indicating conservative leverage. However, the return on equity is minimal at 0.05%, reflecting limited profitability. The equity ratio is robust, suggesting financial stability.
Cash Flow
45
Neutral
Cash flow performance is weak, with a significant decline in free cash flow growth by 89.84% TTM. The operating cash flow to net income ratio is low at 0.20, indicating challenges in converting income into cash. The negative free cash flow to net income ratio further highlights cash flow issues.
BreakdownTTMDec 2024Dec 2023Dec 2022Dec 2021Dec 2020
Income Statement
Total Revenue384.56M371.30M328.20M293.56M243.48M199.52M
Gross Profit165.07M174.41M152.65M138.06M115.41M81.69M
EBITDA52.05M64.38M40.90M25.26M42.59M67.56M
Net Income383.00K4.33M-16.84M-29.89M15.68M31.76M
Balance Sheet
Total Assets1.04B963.80M945.49M1.05B991.89M1.04B
Cash, Cash Equivalents and Short-Term Investments116.42M172.84M154.42M185.61M162.99M411.34M
Total Debt104.74M49.46M69.09M77.70M40.96M56.19M
Total Liabilities274.89M168.69M198.62M228.98M149.87M153.44M
Stockholders Equity763.06M795.11M746.87M825.86M842.02M886.24M
Cash Flow
Free Cash Flow-1.54M4.81M25.98M14.66M-179.56M-32.87M
Operating Cash Flow30.41M36.28M35.94M40.48M44.62M-12.21M
Investing Cash Flow-39.59M16.96M29.34M-63.08M-105.28M101.35M
Financing Cash Flow26.83M-33.54M-81.00M1.76M-78.31M-29.23M

Knight Therapeutics Technical Analysis

Technical Analysis Sentiment
Positive
Last Price6.44
Price Trends
50DMA
6.21
Positive
100DMA
6.04
Positive
200DMA
5.81
Positive
Market Momentum
MACD
0.07
Positive
RSI
56.00
Neutral
STOCH
36.30
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 6.44 is above the 20-day moving average (MA) of 6.41, above the 50-day MA of 6.21, and above the 200-day MA of 5.81, indicating a bullish trend. The MACD of 0.07 indicates Positive momentum. The RSI at 56.00 is Neutral, neither overbought nor oversold. The STOCH value of 36.30 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 (51)
Financial Indicators
Name
Overall Rating
Market Cap
P/E Ratio
ROE
Dividend Yield
Revenue Growth
EPS Growth
61
Neutral
$641.78M1,894.120.03%13.82%
51
Neutral
$7.92B-0.43-41.67%2.21%22.29%-1.85%
$149.54M
$290.52M24.5612.25%
78
Outperform
C$138.10M16.5522.62%1.65%16.82%19.25%
60
Neutral
C$98.39M74.941.88%0.03%-17.30%
53
Neutral
C$171.10M-20.58%-1.42%35.15%
* Healthcare Sector Average
Performance Comparison
Ticker
Company Name
Price
Change
% Change
TSE:GUD
Knight Therapeutics
6.44
0.81
14.39%
THTX
Theratechnologies
3.27
2.04
165.85%
CPHRF
Cipher Pharmaceuticals
11.60
-1.61
-12.19%
TSE:MDP
Medexus Pharmaceuticals Inc
3.08
0.40
14.93%
TSE:RX
Biosyent
11.83
1.41
13.53%
TSE:HLS
HLS Therapeutics Inc
5.45
2.08
61.72%

Knight Therapeutics Corporate Events

Private Placements and FinancingBusiness Operations and StrategyFinancial Disclosures
Knight Therapeutics Achieves Record Revenues Amid Strategic Expansions
Neutral
Aug 7, 2025

Knight Therapeutics reported record-high quarterly revenues for the second quarter of 2025, with a 12% increase over the previous year. Despite the revenue growth, the company faced a net loss of $12,622, attributed to hyperinflation accounting in Argentina affecting gross margins. The company entered into a revolving credit facility with National Bank of Canada and executed an asset purchase agreement with Paladin Pharma Inc., indicating strategic moves to strengthen its market position.

The most recent analyst rating on (TSE:GUD) stock is a Buy with a C$7.00 price target. To see the full list of analyst forecasts on Knight Therapeutics stock, see the TSE:GUD Stock Forecast page.

Private Placements and FinancingM&A TransactionsBusiness Operations and Strategy
Knight Therapeutics Secures US$50 Million Credit Facility to Fuel Growth
Positive
Jun 17, 2025

Knight Therapeutics Inc. has secured a US$50 million revolving credit facility with the National Bank of Canada to support its growth strategy, including the acquisition of Paladin. The facility, which can be increased to US$100 million, provides financial flexibility for acquisitions and business growth, enhancing Knight’s capital structure and operational capabilities in Latin America and Canada.

The most recent analyst rating on (TSE:GUD) stock is a Buy with a C$7.00 price target. To see the full list of analyst forecasts on Knight Therapeutics stock, see the TSE:GUD Stock Forecast page.

Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

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.Date of analysis: Aug 20, 2025