Investment Thesis
Pelthos is a pre-commercial biopharmaceutical company with minimal revenue ($10.9M) and accelerating operating losses (operating margin -120%, net income declined 444.6% YoY). Negative free cash flow of -$13.3M annually against only $32M cash reserves leaves approximately 2-3 years of runway, creating material liquidity risk before achieving product commercialization.
Strengths
- Zero long-term debt eliminates leverage and default risk
- Strong liquidity ratios (2.79x current, 1.86x quick) provide near-term operational flexibility
- Maintains $32M cash reserve providing runway for continued R&D operations
Risks
- Severe and deteriorating profitability with operating losses exceeding revenue by 120%
- Net income declined 444.6% YoY indicating accelerating cash burn and worsening financial trajectory
- Limited cash runway of ~2-3 years at current burn rate creates existential liquidity risk without significant revenue growth or external capital
Key Metrics to Watch
- Quarterly revenue growth rate and path to product commercialization
- Monthly operating cash burn rate and updated runway analysis
- Clinical trial progress, regulatory milestones, and financing activities
Financial Metrics
Revenue
10.9M
Net Income
-10.2M
EPS (Diluted)
$-3.09
Free Cash Flow
-13.3M
Total Assets
145.4M
Cash
32.0M
Profitability Ratios
Gross Margin
N/A
Operating Margin
-120.0%
Net Margin
-93.9%
ROE
-29.2%
ROA
-7.0%
FCF Margin
-122.1%
Balance Sheet & Liquidity
Current Ratio
2.79x
Quick Ratio
1.86x
Debt/Equity
0.00x
Debt/Assets
75.9%
Interest Coverage
-7.71x
Long-term Debt
N/A
Disclaimer: This analysis is generated by AI based on publicly available SEC EDGAR filings.
It does not include stock price data and should not be considered financial advice.
All fundamental data is sourced from SEC public domain filings.
Always conduct your own research before making investment decisions.
Data Source: SEC EDGAR |
Analysis Date: 2026-05-15T08:19:18.357114 |
Data as of: 2026-03-31 |
Powered by Claude AI