Reata Pharmaceuticals (NASDAQ:RETA), a domestic player in the pharmaceuticals sector, has demonstrated a commendable resilience in the face of a slight market downturn. Despite an estimated loss per share (EPS) of -10.43 for the current year and -4.22 for the next, the company has managed to maintain a positive cash flow of $590.3M at the beginning of the period. The company's net assets stand at $514.49M, with a book value of -3.48. Although the company has total debt of $119.46M and total current liabilities of $59M, it has a relatively low debt to equity ratio of 2.08%. Notably, the number of shares shorted decreased from 4M in the prior month to 3.83M, reflecting a short ratio of 5.1. Despite a gross profit loss of $167.6M, Reata's other stockholder equity is robust at
$1.5B. The company's resilience is further underscored by its ability to maintain a cash reserve of $42.3M, even in the face of market headwinds. While some of us are enthusiastic about the pharmaceutical sector, it's prudent to delve deeper into Reata Pharmaceuticals to better assess its actual value. We will examine why this could be a significantly improved year for Reata Pharmaceuticals' shareholders. Is the company's valuation justified? I will discuss Reata Pharmaceuticals' perspective on valuation to provide you with a more informed outlook on whether to take a position in it.
We determine the current worth of Reata Pharmaceuticals using both absolute as well as relative valuation methodologies to arrive at its intrinsic value. In general, an absolute valuation paradigm, as applied to this company, attempts to find the value of Reata Pharmaceuticals based exclusively on its
fundamental and basic
technical indicators. By analyzing Reata Pharmaceuticals's
financials, quarterly and monthly indicators, and related drivers such as
dividends, operating cash flow, and various types of growth rates, we attempt to find the most accurate representation of Reata Pharmaceuticals's intrinsic value. In some cases, mostly for established, large-cap companies, we also incorporate more traditional valuation methods such as dividend discount, discounted cash flow, or asset-based models. As compared to an absolute model, our relative valuation model uses a comparative analysis of Reata Pharmaceuticals. We calculate exposure to Reata Pharmaceuticals's
market risk, different
technical and
fundamental indicators, relevant financial multiples and ratios, and then
comparing them to Reata Pharmaceuticals's related companies.
Reata Pharmaceuticals Investment Alerts
Reata investment alerts and warnings help investors to get more proficient at understanding not only critical technical and fundamental signals but also the significant portfolio-centered indicators. These indicators include beta, alpha, and other risk-related measures that will help you in monitoring Reata Pharmaceuticals performance across your portfolios.Please check all
investment alerts for Reata
Reata Pharmaceuticals Valuation Ratios as Compared to Competition
Our valuation model uses many indicators to compare Reata value to that of its competitors to determine the firm's financial worth. You can analyze the relationship between different fundamental ratios across Reata Pharmaceuticals competition to find
correlations between indicators driving the intrinsic value of Reata.
Detailed Perspective On Reata Pharmaceuticals
The current price rise of Reata Pharmaceuticals created some momentum for investors as it was traded today as low as
165.52 and as high as
167.24 per share. The company directors and management may have good odds in positioning the company resources to exploit
market volatility in
September. The stock standard deviation of daily returns for 90 days investing horizon is currently 8.01. The very high volatility is mostly attributed to the latest market swings and not very good earnings reports from some of the Reata Pharmaceuticals partners.
Margins Breakdown
Reata profit margins show the degree to which it makes money. Margin indicators are used not only by investors but also by creditors or Reata Pharmaceuticals itself as indicators of financial health and management effectiveness. Please look more closely at the different varieties of Reata Pharmaceuticals profit margins.
| Operating Margin | (115.21) |
| EBITDA Margin | (19.57) |
| Gross Margin | 0.89 |
| Profit Margin | (23.91) |
Reata Pharmaceuticals Average Assets is increasing over the last 8 years. Reata Pharmaceuticals Net Income Per Employee is decreasing over the last 8 years. Additionally, Reata Pharmaceuticals Earnings Before Interest Taxes and Depreciation Amortization EBITDA is somewhat stable at the moment. Reata Pharmaceuticals Average Assets is somewhat stable at the moment. Reata Pharmaceuticals Net Income Per Employee is somewhat stable at the moment. Additionally, Reata Pharmaceuticals Earnings Before Interest Taxes and Depreciation Amortization EBITDA is decreasing over the last 8 years. The previous year's value of Reata Pharmaceuticals Earnings Before Interest Taxes and Depreciation Amortization EBITDA was -284,190,947.
Reata Pharmaceuticals (NASDAQ:RETA) continues to demonstrate resilience in the face of a slight market downturn. Despite a negative EBITDA of $323.3M and a net income loss of $311.9M, the biotechnology firm has managed to maintain a market capitalization of
$6.23B. The company's shares are heavily backed by institutions, with 96.17% of shares owned by institutions and a percent institutions of 101.73. This suggests a high level of confidence in the company's long-term prospects. The company's stock has been shorted 3.83M times, indicating some investor skepticism. However, the stock's 52-week high stands at $167.24, and the Wall Street target price is $153.4, suggesting potential for growth. The company's price to book ratio is a staggering 285.94X, while its price to sales ratio is 414.73X, indicating a high valuation. Reata Pharmaceuticals has a risk-adjusted performance of 0.0973 and a Sortino ratio of 0.2715, indicating a reasonable level of risk relative to potential returns. The company's downside deviation is 3.59, which is relatively high, indicating potential for significant price swings. However, the company's total risk alpha is 0.5063, suggesting that the stock may offer higher returns when adjusted for risk. Despite the challenges, Reata Pharmaceuticals remains a significant player in the biotechnology industry, with
321 full-time employees and a strong presence in the pharmaceuticals service category. The company's resilience in the face of market downturns and its high institutional backing suggest potential for future growth. .
Reata technical analysis suggests possible collapse
Reata Pharmaceuticals' stock is showing worrying signs of a potential downturn, according to recent
technical analysis. The maximum drawdown, a crucial risk metric that quantifies the largest single drop from peak to trough in a portfolio's value, has hit 54.98%. This significant decrease suggests a notable downward trend, implying a precarious future for the stock. Investors are recommended to proceed with caution and keep a close eye on the stock's performance in the upcoming days. Reata Pharmaceuticals is demonstrating above-average volatility over the chosen time period. Investors are advised to thoroughly examine Reata Pharmaceuticals independently to ensure their intended
market timing strategies align with their expectations about the company's volatility. Understanding different
market volatility trends often assists investors in timing the market correctly. Proper use of volatility indicators allows traders to gauge the risk of Reata Pharmaceuticals' stock against market volatility during both upward and downward trends. The heightened level of volatility that accompanies bear markets can directly affect
Reata Pharmaceuticals' stock price, adding stress for investors as they see the value of their shares decrease.
This typically compels investors to rebalance their portfolios by purchasing different stocks as prices drop. Despite a modest market slip, Reata Pharmaceuticals (USA Stocks:RETA) has managed to build up today, showing resilience in a challenging environment. The company's current valuation market value stands at
$166.51, with a real value of $129.77, suggesting a potential overvaluation. However, the naive expected forecast value is $183.48, indicating potential for growth. The analyst overall consensus is a 'Hold', with 6 holds and 5 strong buys. The estimated target price is $136.318, with the highest and lowest estimated target prices being $185 and $75 respectively. While the number of estimates raised and lowered are both 3, the possible upside price is $191.49, which could provide a significant return for investors. However, investors should also consider the possible downside price of
$175.47. In conclusion, Reata Pharmaceuticals presents a mixed investment opportunity with potential for both gains and losses. .
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Ellen Johnson is a Member of Macroaxis Editorial Board. Ellen covers public companies in North America, focusing primarily on valuation and volatility. Six years of experience in predictive investment analytics and risk management.
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