Knight Therapeutics (GUD) AI Stock Analysis

• Market Cap: C$597.76M
• Dividend Yield: N/A
• Average Volume (3M): 42.61K
• Price to Earnings (P/E): 54.1
• Beta (1Y): 0.27
• Revenue Growth: 12.21%
• EPS Growth: N/A
• Country: CA
• Employees: 745
• Sector: Healthcare
• Sector Strength: 42
• Industry: Drug Manufacturers - Specialty & Generic
• EPS (TTM): 0.02
• Shares Outstanding: 99,627,420
• 10 Day Avg. Volume: 38,238
• 30 Day Avg. Volume: 42,610
• PEG Ratio: 0.39
• Price to Book (P/B): 0.73
• Price to Sales (P/S): 0.00
• P/FCF Ratio: -38.01
• 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: C$7.90
• Price Target Upside: 31.71% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 6

• Rating: 62 Neutral
• Price Target: C$6.00 ▲(0.00%Upside)

Knight Therapeutics demonstrates solid revenue growth and a stable balance sheet, but faces challenges in profitability and cash flow. The technical analysis suggests a neutral to slightly negative momentum, while a high P/E ratio raises valuation concerns. Recent strategic acquisitions and positive corporate events offer potential growth opportunities.

Positive Factors

Financial Performance

Knight reported 4Q-2024 results that beat estimates.

Revenue Growth

Revenues grew 31% year-over-year on an IFRS basis.

Negative Factors

Currency and Inflation Impact

FX and hyperinflation skewed the topline results.

Knight Therapeutics Business Overview & Revenue Model

Company Description

Knight 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 Money

Knight Therapeutics generates revenue primarily through the sale of its pharmaceutical products. The company acquires or in-licenses products from global pharmaceutical partners and markets them within Canada and other select regions. Revenue streams include sales from branded prescription medications, over-the-counter products, and medical devices. Additionally, Knight engages in strategic partnerships and alliances to expand its product offerings and market reach. These partnerships often involve licensing agreements where Knight pays an upfront fee and royalties based on product sales. The company focuses on niche markets and therapeutic areas where it can leverage its expertise and relationships to drive sales growth.

Knight Therapeutics Financial Statement Overview

Summary

Knight Therapeutics shows strong revenue growth and a robust balance sheet with low leverage and high equity ratios. However, there are challenges in profitability and cash flow sustainability, impacting financial flexibility.

Income Statement

The income statement shows a steady revenue increase, with a notable 13.3% growth from 2022 to 2023, contributing to the positive revenue trajectory. Gross profit margins have been maintained above 45% across periods, indicating good cost management. However, the company faces challenges in profitability, with EBIT margins fluctuating and sometimes negative, impacting net profit margins. Recent improvement in net income for TTM suggests potential recovery.

Balance Sheet

The balance sheet reflects a strong equity base, with a high equity ratio of approximately 79.3% in TTM, indicating financial stability. The debt-to-equity ratio remains low, around 0.07, which suggests prudent use of leverage. However, there is room for improvement in ROE, which, despite being positive in TTM, remains modest compared to industry norms.

Cash Flow

Cash flow analysis reveals challenges in sustaining free cash flow, with negative free cash flow reported in TTM. The operating cash flow to net income ratio is high, indicating good operational efficiency. However, the negative free cash flow growth and fluctuating capital expenditures pose concerns for long-term cash sustainability.

Breakdown
TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement		Total Revenue
372.78M	371.30M	328.20M	293.56M	243.48M	199.52M
	Gross Profit
167.57M	174.41M	152.65M	138.06M	115.41M	81.69M
	EBIT
-800.00K	7.40M	-2.89M	-2.40M	-5.32M	-3.44M
	EBITDA
70.81M	64.38M	40.90M	25.26M	42.59M	67.56M
	Net Income Common Stockholders
11.06M	4.33M	-16.84M	-29.89M	15.68M	31.76M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
180.86M	172.84M	154.42M	191.22M	162.99M	411.34M
	Total Assets
1.00B	963.80M	945.49M	1.05B	991.89M	1.04B
	Total Debt
53.92M	49.46M	69.09M	77.70M	40.96M	56.19M
	Net Debt
-58.24M	-30.65M	10.33M	6.02M	-45.01M	-173.40M
	Total Liabilities
207.60M	168.69M	198.62M	228.98M	149.87M	153.44M
	Stockholders Equity
795.44M	795.11M	746.87M	825.86M	842.02M	886.24M
Cash Flow		Free Cash Flow
-15.18M	4.81M	25.98M	14.66M	-179.56M	-32.87M
	Operating Cash Flow
7.97M	36.28M	35.94M	40.48M	44.62M	-12.21M
	Investing Cash Flow
71.26M	16.96M	29.34M	-63.08M	-105.28M	101.35M
	Financing Cash Flow
-35.34M	-33.54M	-81.00M	1.76M	-78.31M	-29.23M

Knight Therapeutics Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 6.00
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: 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 is above the 20-day moving average (MA) of 5.81, above the 50-day MA of 5.86, and above the 200-day MA of 5.66, indicating a bullish trend. The MACD of 0.01 indicates Negative momentum. The RSI at 61.15 is Neutral, neither overbought nor oversold. The STOCH value of 78.41 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

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
GUD	62 Neutral	C$597.76M	54.10	1.41%	―	12.21%	―
Sector *	54 Neutral	$5.31B	3.29	-45.39%	2.79%	16.77%	-0.07%
THTX		$118.18M	―		―	―	―
CPHRF		$247.89M	26.16	9.69%	―	―	―
RX	82 Outperform	C$134.21M	17.10	22.17%	1.62%	16.55%	14.70%
MDP	71 Outperform	C$93.55M	14.26	11.27%	―	-3.82%	-50.36%
HLS	60 Neutral	C$156.27M	―	-23.05%	―	-3.73%	32.70%

Knight Therapeutics Corporate Events

Knight Therapeutics Reports Q1 2025 Financial Results and Strategic Developments

Knight Therapeutics reported its first-quarter 2025 financial results, highlighting a 2% increase in revenues driven by the growth of key promoted products, despite declines in mature products and currency depreciation in Latin America. The company experienced a decrease in gross margin due to hyperinflation accounting in Argentina and reported an operating loss, although net income improved compared to the previous year. Knight also announced corporate developments, including an asset purchase agreement with Endo Operations Limited and Paladin Pharma Inc., and the acquisition of common shares through its NCIB. Additionally, Knight made several product advancements, including regulatory approvals and launches in Mexico and Brazil.

Knight Therapeutics Announces AGM Results and Strategic Approvals

Knight Therapeutics Inc. announced the results of its Annual General Meeting, where all director nominees were elected, Ernst & Young LLP was appointed as external auditors, and the renewal of unallocated rights under the company’s share purchase plan was approved. These decisions reflect strong shareholder support and are expected to bolster the company’s governance and operational strategies, potentially enhancing its market position in the specialty pharmaceutical sector.

Knight Therapeutics Achieves Record Revenues and Expands Product Approvals

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.

Knight Therapeutics to Acquire Paladin Pharma for $120 Million

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.