Fundamental Analysis of VERASTEM INC(NASDAQ:VSTM) stock

Fundamental Rating

Overall VSTM gets a fundamental rating of 2 out of 10. We evaluated VSTM against 588 industry peers in the Biotechnology industry. Both the profitability and financial health of VSTM have multiple concerns. VSTM is quite expensive at the moment. It does show a decent growth rate.

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1. Profitability

1.1 Basic Checks

In the past year VSTM has reported negative net income.

In the past year VSTM has reported a negative cash flow from operations.

VSTM had negative earnings in each of the past 5 years.

VSTM had a negative operating cash flow in each of the past 5 years.

1.2 Ratios

VSTM has a Return On Assets of -58.35%. This is comparable to the rest of the industry: VSTM outperforms 42.22% of its industry peers.

With a Return On Equity value of -111.24%, VSTM perfoms like the industry average, outperforming 42.56% of the companies in the same industry.

		Industry Rank	Sector Rank
ROA	-58.35%
ROE	-111.24%
ROIC	N/A

ROA(3y)-67.16%

ROA(5y)-69.65%

ROE(3y)-116.08%

ROE(5y)-495.87%

ROIC(3y)N/A

ROIC(5y)N/A

1.3 Margins

VSTM does not have Profit Margin and Operating Margin and Gross Margin available, so we won't be analyzing them here.

		Industry Rank	Sector Rank
OM	N/A
PM (TTM)	N/A
GM	N/A

OM growth 3YN/A

OM growth 5YN/A

PM growth 3YN/A

PM growth 5YN/A

GM growth 3YN/A

GM growth 5YN/A

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ROA

ROE

ROIC

Operating and Profit Margin

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2. Health

2.1 Basic Checks

VSTM does not have a ROIC to compare to the WACC, probably because it is not profitable.

The number of shares outstanding for VSTM has been increased compared to 1 year ago.

Compared to 5 years ago, VSTM has more shares outstanding

Compared to 1 year ago, VSTM has a worse debt to assets ratio.

2.2 Solvency

VSTM has an Altman-Z score of -6.62. This is a bad value and indicates that VSTM is not financially healthy and even has some risk of bankruptcy.

With a Altman-Z score value of -6.62, VSTM is not doing good in the industry: 68.03% of the companies in the same industry are doing better.

A Debt/Equity ratio of 0.51 indicates that VSTM is somewhat dependend on debt financing.

VSTM's Debt to Equity ratio of 0.51 is on the low side compared to the rest of the industry. VSTM is outperformed by 73.33% of its industry peers.

		Industry Rank	Sector Rank
Debt/Equity	0.51
Debt/FCF	N/A
Altman-Z	-6.62

ROIC/WACCN/A

WACC9.3%

2.3 Liquidity

A Current Ratio of 5.45 indicates that VSTM has no problem at all paying its short term obligations.

VSTM has a Current ratio (5.45) which is comparable to the rest of the industry.

VSTM has a Quick Ratio of 5.45. This indicates that VSTM is financially healthy and has no problem in meeting its short term obligations.

Looking at the Quick ratio, with a value of 5.45, VSTM is in line with its industry, outperforming 58.97% of the companies in the same industry.

		Industry Rank	Sector Rank
Current Ratio	5.45
Quick Ratio	5.45

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WACC

Debt/Equity

How to determine the health of a company

Altman-Z score

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3. Growth

3.1 Past

VSTM shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 10.09%, which is quite good.

The Revenue for VSTM has decreased by -100.00% in the past year. This is quite bad

EPS 1Y (TTM)10.09%

EPS 3YN/A

EPS 5YN/A

EPS growth Q2Q-6.25%

Revenue 1Y (TTM)-100%

Revenue growth 3YN/A

Revenue growth 5YN/A

Revenue growth Q2QN/A

3.2 Future

The Earnings Per Share is expected to grow by 31.69% on average over the next years. This is a very strong growth

The Revenue is expected to grow by 131.06% on average over the next years. This is a very strong growth

EPS Next Y6.54%

EPS Next 2Y15.27%

EPS Next 3Y16.08%

EPS Next 5Y31.69%

Revenue Next Year-100%

Revenue Next 2Y142.76%

Revenue Next 3Y169.7%

Revenue Next 5Y131.06%

3.3 Evolution

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4. Valuation

4.1 Price/Earnings Ratio

The Price/Earnings Ratio is negative for VSTM. In the last year negative earnings were reported.

Besides the negative Price/Earnings Ratio, also the Forward Price/Earnings Ratio is negative for VSTM. No positive earnings are expected for the next year.

		Industry Rank	Sector Rank
PE	N/A
Fwd PE	N/A

4.2 Price Multiples

		Industry Rank	Sector Rank
P/FCF	N/A
EV/EBITDA	N/A

4.3 Compensation for Growth

A more expensive valuation may be justified as VSTM's earnings are expected to grow with 16.08% in the coming years.

PEG (NY)N/A

PEG (5Y)N/A

EPS Next 2Y15.27%

EPS Next 3Y16.08%

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5. Dividend

5.1 Amount

VSTM does not give a dividend.

		Industry Rank	Sector Rank
Dividend Yield	N/A

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VERASTEM INC

NASDAQ:VSTM (4/19/2024, 7:23:17 PM)

After market: 10.05 +0.21 (+2.13%)

9.84

-0.39 (-3.81%)

Chartmill FA Rating

GICS SectorHealth Care

GICS IndustryGroupPharmaceuticals, Biotechnology & Life Sciences

GICS IndustryBiotechnology

Earnings (Last)

Earnings (Next)

Inst Owners

Inst Owner Change

Ins Owners

Ins Owner Change

Market Cap248.95M

Analysts

Price Target

Dividend

		Industry Rank	Sector Rank
Dividend Yield	N/A

Dividend Growth(5Y)

Div Incr Years

Div Non Decr Years

Ex-Date

Surprises & Revisions

EPS beat(2)

Avg EPS beat(2)

Min EPS beat(2)

Max EPS beat(2)

EPS beat(4)

Avg EPS beat(4)

Min EPS beat(4)

Max EPS beat(4)

EPS beat(8)

Avg EPS beat(8)

EPS beat(12)

Avg EPS beat(12)

EPS beat(16)

Avg EPS beat(16)

Revenue beat(2)

Avg Revenue beat(2)

Min Revenue beat(2)

Max Revenue beat(2)

Revenue beat(4)

Avg Revenue beat(4)

Min Revenue beat(4)

Max Revenue beat(4)

Revenue beat(8)

Avg Revenue beat(8)

Revenue beat(12)

Avg Revenue beat(12)

Revenue beat(16)

Avg Revenue beat(16)

PT rev (1m)

PT rev (3m)

EPS NQ rev (1m)

EPS NQ rev (3m)

EPS NY rev (1m)

EPS NY rev (3m)

Revenue NQ rev (1m)

Revenue NQ rev (3m)

Revenue NY rev (1m)

Revenue NY rev (3m)

Valuation

		Industry Rank	Sector Rank
PE	N/A
Fwd PE	N/A
P/S
P/FCF
P/OCF
P/B
P/tB
EV/EBITDA

EPS(TTM)

EPS(NY)

Fwd EY

FCF(TTM)

FCFY

OCF(TTM)

OCFY

SpS

BVpS

TBVpS

PEG (NY)N/A

PEG (5Y)N/A

Profitability

		Industry Rank	Sector Rank
ROA	-58.35%
ROE	-111.24%
ROCE
ROIC
ROICexc
ROICexgc
OM	N/A
PM (TTM)	N/A
GM	N/A
FCFM

ROA(3y)

ROA(5y)

ROE(3y)

ROE(5y)

ROIC(3y)

ROIC(5y)

ROICexc(3y)

ROICexc(5y)

ROICexgc(3y)

ROICexgc(5y)

ROCE(3y)

ROCE(5y)

ROICexcg growth 3Y

ROICexcg growth 5Y

ROICexc growth 3Y

ROICexc growth 5Y

OM growth 3Y

OM growth 5Y

PM growth 3Y

PM growth 5Y

GM growth 3Y

GM growth 5Y

F-Score

Asset Turnover0

Health

		Industry Rank	Sector Rank
Debt/Equity	0.51
Debt/FCF
Debt/EBITDA
Cap/Depr
Cap/Sales
Interest Coverage
Cash Conversion
Profit Quality
Current Ratio	5.45
Quick Ratio	5.45
Altman-Z

F-Score

WACC

ROIC/WACC

Cap/Depr(3y)

Cap/Depr(5y)

Cap/Sales(3y)

Cap/Sales(5y)

Profit Quality(3y)

Profit Quality(5y)

Growth

EPS 1Y (TTM)10.09%

EPS 3YN/A

EPS 5Y

EPS growth Q2Q

EPS Next Y6.54%

EPS Next 2Y

EPS Next 3Y

EPS Next 5Y

Revenue 1Y (TTM)-100%

Revenue growth 3YN/A

Revenue growth 5Y

Revenue growth Q2Q

Revenue Next Year

Revenue Next 2Y

Revenue Next 3Y

Revenue Next 5Y

EBIT growth 1Y

EBIT growth 3Y

EBIT growth 5Y

EBIT Next Year

EBIT Next 3Y

EBIT Next 5Y

FCF growth 1Y

FCF growth 3Y

FCF growth 5Y

OCF growth 1Y

OCF growth 3Y

OCF growth 5Y

VERASTEM INC (VSTM)

1. Profitability

1.1 Basic Checks

1.2 Ratios

1.3 Margins

More info and screens

2. Health

2.1 Basic Checks

2.2 Solvency

2.3 Liquidity

More info and screens

3. Growth

3.1 Past

3.2 Future

3.3 Evolution

More info and screens

4. Valuation

4.1 Price/Earnings Ratio

4.2 Price Multiples

4.3 Compensation for Growth

More info and screens

5. Dividend

5.1 Amount

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