Knight Therapeutics (GUD) AI Stock Analysis

• Market Cap: C$572.85M
• Dividend Yield: N/A
• Average Volume (3M): 71.73K
• Price to Earnings (P/E): 51.8
• Beta (1Y): 0.28
• 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: 99,626,620
• 10 Day Avg. Volume: 130,717
• 30 Day Avg. Volume: 71,735
• PEG Ratio: 0.40
• Price to Book (P/B): 0.75
• Price to Sales (P/S): 0.00
• P/FCF Ratio: -39.52
• 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$7.98
• Price Target Upside: 38.84% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 4

• Rating: 60 Neutral
• Price Target: C$6.00 ▲(4.35%Upside)

Knight Therapeutics' strong revenue growth and strategic moves are offset by profitability challenges and an overvalued stock price, resulting in a moderate overall score. The technical indicators suggest a neutral to slightly bearish outlook.

Positive Factors

Financial Performance

Knight's 4Q-2024 results exceeded estimates, indicating strong financial performance and potential investor confidence.

Licensing Agreement

Knight's exclusive Canadian licensing agreement with Sumitomo Pharma America for growth assets like Myfembree, Orgovyx, and Vibegron could enhance its market position and revenues.

Revenue Growth

Revenues are projected to rise due to Knight's re-signing of a $22.4M contract with the Brazilian Ministry of Health, highlighting the company's growth potential.

Negative Factors

Earnings

Knight's results, while ahead of consensus, missed topline estimates, which might raise concerns about meeting future financial targets.

Topline Results

FX and hyperinflation effects skewed Knight's topline results, which could be a concern for investors assessing financial stability.

Knight Therapeutics Business Overview & Revenue Model

Company Description

Knight Therapeutics Inc. (GUD) is a specialty pharmaceutical company focused on acquiring or in-licensing pharmaceutical products for the Canadian and select international markets. The company primarily operates within the healthcare sector, specifically in pharmaceuticals, and offers a portfolio of branded prescription pharmaceuticals, over-the-counter products, and medical devices. Knight aims to provide innovative and niche products that address unmet medical needs, enhancing the quality of healthcare for patients.

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 with a robust balance sheet characterized by low leverage and high equity ratios. However, profitability challenges and issues with cash flow sustainability present concerns for future 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
EBITDA	70.81M	64.38M	40.90M	25.26M	42.59M	67.56M
Net Income	11.06M	4.33M	-16.84M	-29.89M	15.68M	31.76M
Balance Sheet
Total Assets	1.06B	963.80M	945.49M	1.05B	991.89M	1.04B
Cash, Cash Equivalents and Short-Term Investments	638.55M	172.84M	154.42M	185.61M	162.99M	411.34M
Total Debt	1.07M	49.46M	69.09M	77.70M	40.96M	56.19M
Total Liabilities	25.64M	168.69M	198.62M	228.98M	149.87M	153.44M
Stockholders Equity	1.03B	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: Negative
• Last Price: 5.75
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TSE:GUD, the sentiment is Negative. The current price of 5.75 is below the 20-day moving average (MA) of 5.91, below the 50-day MA of 5.88, and above the 200-day MA of 5.68, indicating a neutral trend. The MACD of -0.03 indicates Positive momentum. The RSI at 39.45 is Neutral, neither overbought nor oversold. The STOCH value of 3.82 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for TSE:GUD.

Knight Therapeutics Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
RX	82 Outperform	C$135.24M	17.23	22.17%	2.33%	16.55%	14.70%
CPH	72 Outperform	C$327.20M	24.80	9.69%	―	84.83%	-58.69%
MDP	71 Outperform	C$101.61M	24.53	5.27%	―	-3.82%	-50.36%
GUD	60 Neutral	C$572.85M	51.85	1.41%	―	12.21%	―
HLS	56 Neutral	C$151.16M	―	-23.05%	―	-3.73%	32.70%
TH	49 Neutral	$150.81M	―		―	16.23%	85.76%
Sector *	46 Neutral	C$190.36M	-4.25	-8.56%	3.09%	13.53%	-1.76%

Knight Therapeutics Corporate Events

Knight Therapeutics Secures US$50 Million Credit Facility to Fuel Growth

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.

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.