Elevation Oncology, Inc. (ELEV) Bundle
Understanding Elevation Oncology, Inc. (ELEV) Revenue Streams
Understanding Elevation Oncology’s Revenue Streams
Elevation Oncology, Inc. has not generated any revenue from product sales or other sources since its inception in 2019. The company expects this trend to continue for several years as it focuses on the clinical development of its product candidates.
Breakdown of Primary Revenue Sources
As of September 30, 2024, the company has no revenue streams from products or services. All operational funding has come from financing activities, including the sale of common stock and debt financing.
Year-over-Year Revenue Growth Rate
Since the company has not generated revenue, there are no year-over-year growth rates to report. The net loss for the nine months ended September 30, 2024, was $34.0 million, compared to a net loss of $37.8 million during the same period in 2023, indicating a reduction in losses rather than revenue growth.
Contribution of Different Business Segments to Overall Revenue
Elevation Oncology currently operates as a clinical-stage company and has not commercialized any product, leading to zero revenue contribution from any business segments.
Analysis of Significant Changes in Revenue Streams
As there are no revenue streams, significant changes cannot be analyzed. The company’s focus remains on advancing its pipeline, particularly the lead product candidate, EO-3021. The total operating expenses for the nine months ended September 30, 2024, were $34.1 million, down from $37.5 million in the same period in 2023, primarily due to a reduction in restructuring charges and overall operational efficiencies.
| Financial Metric | Q3 2024 | Q3 2023 |
|---|---|---|
| Net Loss | $12.9 million | $10.6 million |
| Net Loss (Nine Months) | $34.0 million | $37.8 million |
| Total Operating Expenses | $34.1 million | $37.5 million |
| Cash, Cash Equivalents, and Marketable Securities | $103.1 million | $62.4 million (as of September 30, 2023) |
In summary, Elevation Oncology has not reported any revenue and continues to rely on external funding sources to support its operations. The company's financial health is characterized by significant operational losses, which it aims to mitigate through strategic advancements in its clinical pipeline.
A Deep Dive into Elevation Oncology, Inc. (ELEV) Profitability
A Deep Dive into Elevation Oncology's Profitability
Gross Profit Margin: The gross profit margin is not directly applicable as the company has not yet generated revenue from product sales. As of September 30, 2024, the accumulated deficit stood at $230.0 million.
Operating Profit Margin: For the nine months ended September 30, 2024, the company reported a loss from operations of $34.1 million. The total operating expenses for this period were $34.1 million, compared to $37.5 million for the same period in 2023, indicating a decrease in operating losses.
Net Profit Margin: The net loss for the nine months ended September 30, 2024, was $34.0 million, compared to a net loss of $37.8 million for the same period in 2023. This results in a net loss per share (basic and diluted) of $0.60 for the nine months ended September 30, 2024.
Trends in Profitability Over Time
Net losses have decreased year-over-year, reflecting improvements in cost management. The net loss decreased from $37.8 million in the nine months ended September 30, 2023, to $34.0 million in the same period in 2024. The operating loss also improved from $37.5 million to $34.1 million during the same timeframe.
Comparison of Profitability Ratios with Industry Averages
As a clinical-stage company, direct comparisons to industry profitability ratios are challenging due to the lack of revenue generation. However, the average net loss margin for similar biotech firms often ranges from 30% to 50% of total expenses. The company's current net loss margin is approximately 100%, given that it has not yet generated revenue.
Analysis of Operational Efficiency
The total operating expenses for the nine months ended September 30, 2024, were $34.1 million, a reduction from $37.5 million in the previous year. The breakdown of these expenses showed:
| Expense Category | 2024 (in $ millions) | 2023 (in $ millions) | Change (in $ millions) |
|---|---|---|---|
| Research and Development | 21.9 | 20.7 | 1.2 |
| General and Administrative | 12.1 | 11.6 | 0.5 |
| Restructuring Charges | 0.0 | 5.1 | (5.1) |
| Total Operating Expenses | 34.1 | 37.5 | (3.4) |
The increase in research and development costs is attributed to ongoing investments in product candidates, while the absence of restructuring charges in 2024 contributed to the overall decrease in total operating expenses.
As of September 30, 2024, the company had cash, cash equivalents, and marketable securities totaling $103.1 million, which provides a runway into 2026 for ongoing operations.
Debt vs. Equity: How Elevation Oncology, Inc. (ELEV) Finances Its Growth
Debt vs. Equity: How Elevation Oncology Finances Its Growth
As of September 30, 2024, the long-term debt of Elevation Oncology, Inc. stands at $31.0 million, which includes the principal amount of $30.0 million and an accreted liability of $1.0 million . The company has no short-term debt reported.
The debt-to-equity ratio is calculated as follows:
- Long-term debt: $31.0 million
- Total stockholders' equity: $69.4 million
This results in a debt-to-equity ratio of approximately 0.45, which is below the industry average of around 0.75 for biotech companies.
In terms of recent debt activity, the company has reported a loss on extinguishment of debt amounting to $0.9 million during the nine months ended September 30, 2024, related to the amendment of its debt facility. The effective interest rate on the first tranche of the term loan is currently 12.29%. Total interest expenses for the three months ended September 30, 2024, were $1.0 million, while for the nine months, it totaled $3.0 million.
The company balances its financing between debt and equity by utilizing both methods to fund its operations, research, and development. In 2024, the company raised approximately $44.2 million through the issuance of common stock under its at-the-market offering. Additionally, as of September 30, 2024, the company had cash, cash equivalents, and marketable securities totaling $103.1 million, which it expects will sustain operational needs until at least 2026.
| Financial Metric | Amount (in millions) |
|---|---|
| Long-term Debt | $31.0 |
| Total Stockholders' Equity | $69.4 |
| Debt-to-Equity Ratio | 0.45 |
| Loss on Extinguishment of Debt | $0.9 |
| Effective Interest Rate | 12.29% |
| Total Interest Expenses (3 months) | $1.0 |
| Total Interest Expenses (9 months) | $3.0 |
| Cash, Cash Equivalents, and Marketable Securities | $103.1 |
| Funds Raised via Common Stock Issuance | $44.2 |
Assessing Elevation Oncology, Inc. (ELEV) Liquidity
Assessing Elevation Oncology, Inc. Liquidity
Current Ratio: As of September 30, 2024, the current ratio is calculated as follows:
Current Assets: $105.3 million
Current Liabilities: $5.9 million
Current Ratio = Current Assets / Current Liabilities = 17.8
Quick Ratio: The quick ratio is calculated using liquid assets:
Quick Assets (Cash + Marketable Securities): $103.1 million
Quick Ratio = Quick Assets / Current Liabilities = 17.4
Analysis of Working Capital Trends
As of September 30, 2024, working capital is:
Working Capital = Current Assets - Current Liabilities = $105.3 million - $5.9 million = $99.4 million
Cash Flow Statements Overview
The following table summarizes cash flows for the nine months ended September 30, 2024 and 2023 (in thousands):
| Cash Flow Category | 2024 | 2023 |
|---|---|---|
| Cash used in operating activities | $(26,162) | $(43,999) |
| Cash (used in) provided by investing activities | $(19,833) | $4,983 |
| Cash provided by financing activities | $44,942 | $47,977 |
| Net (decrease) increase in cash and cash equivalents | $(1,053) | $8,961 |
Potential Liquidity Concerns or Strengths
As of September 30, 2024, the company has:
- Cash, cash equivalents, and marketable securities totaling $103.1 million.
- An accumulated deficit of $230.0 million.
- Net losses of $34.0 million for the nine months ended September 30, 2024.
Future funding requirements may increase as the company advances its clinical trials and product development. The company expects to utilize its existing cash reserves to fund operations through at least 2026.
Is Elevation Oncology, Inc. (ELEV) Overvalued or Undervalued?
Valuation Analysis
Price-to-Earnings (P/E) Ratio
The current price-to-earnings (P/E) ratio for Elevation Oncology, Inc. is not applicable as the company reported a net loss of $34.0 million for the nine months ended September 30, 2024, resulting in a net loss per share of $0.60.
Price-to-Book (P/B) Ratio
The price-to-book (P/B) ratio can be calculated using the latest stock price and the book value per share. As of September 30, 2024, the total stockholders' equity was $69.4 million, with 59,119,055 shares outstanding. This gives a book value per share of approximately $1.17.
Assuming a recent stock price of approximately $2.00, the P/B ratio would be approximately 1.71.
Enterprise Value-to-EBITDA (EV/EBITDA) Ratio
As the company has not reported any EBITDA due to consistent net losses, the EV/EBITDA ratio is not applicable. The enterprise value, calculated by taking the market capitalization and adding total debt while subtracting cash and cash equivalents, stands at approximately $66.0 million.
Stock Price Trends
Over the past 12 months, the stock price has fluctuated significantly. The stock price started the year at approximately $1.50, reached a high of $3.00, and currently trades around $2.00.
Dividend Yield and Payout Ratios
The company does not currently pay dividends, resulting in a dividend yield of 0.00%. The payout ratio is also 0% due to the absence of dividend payments.
Analyst Consensus
Analyst consensus on the stock valuation indicates a Hold rating, with varying price targets reflecting the company's ongoing clinical development and cash position.
| Metric | Value |
|---|---|
| P/E Ratio | N/A |
| P/B Ratio | 1.71 |
| EV/EBITDA Ratio | N/A |
| Stock Price (12 Months) | $2.00 |
| Dividend Yield | 0.00% |
| Payout Ratio | 0% |
| Analyst Consensus | Hold |
As of September 30, 2024, the company had cash, cash equivalents, and marketable securities totaling $103.1 million.
Key Risks Facing Elevation Oncology, Inc. (ELEV)
Key Risks Facing Elevation Oncology, Inc.
The financial health of the company is impacted by various internal and external risk factors that investors should consider. Below are the primary risks affecting the company as of 2024:
Industry Competition
The biotechnology sector is highly competitive, with numerous companies pursuing similar therapeutic areas. The company faces competition from established pharmaceutical companies and emerging biotech firms that may develop more effective or safer treatments, potentially diminishing the market share of its product candidates.
Regulatory Changes
Changes in regulatory policies can significantly impact the company’s operations and product development timelines. The company must navigate complex regulatory environments to gain approval for its product candidates, which can be uncertain and time-consuming. For instance, any changes in FDA guidelines can delay clinical trials and subsequent marketing approvals.
Market Conditions
Market fluctuations can affect the company’s ability to raise capital. As of September 30, 2024, the company had cash, cash equivalents, and marketable securities totaling $103.1 million. However, adverse market conditions could limit funding options, affecting ongoing and future projects.
Operational Risks
Operational risks include reliance on third-party manufacturers for clinical supplies. Any disruptions in manufacturing could delay product development. The company’s lead product candidate, EO-3021, is critical for its future success, and any setbacks could have serious implications.
Financial Risks
The company has incurred net losses of $34.0 million for the nine months ended September 30, 2024. Accumulated deficits have reached $230.0 million as of the same date. Ongoing research and development activities necessitate substantial capital, and the company may need to secure additional financing to support these efforts.
Strategic Risks
Strategic decisions, such as prioritizing certain product candidates over others, can affect the company’s long-term viability. In January 2023, the company paused investment in the clinical development of seribantumab, focusing resources on EO-3021. Such strategic pivots can have significant implications for future revenue streams.
Mitigation Strategies
- Maintaining a diversified pipeline to reduce dependency on a single product candidate.
- Establishing partnerships and collaborations to share the financial burden of product development.
- Implementing rigorous compliance and quality control measures to mitigate operational risks.
| Risk Factor | Description | Current Status |
|---|---|---|
| Industry Competition | High competition in biotechnology sector. | Numerous competitors developing similar therapies. |
| Regulatory Changes | Potential changes in FDA guidelines affecting approval timelines. | Compliance with existing regulations ongoing. |
| Market Conditions | Fluctuating market conditions affecting capital raising. | Cash, cash equivalents, and marketable securities of $103.1 million. |
| Operational Risks | Reliance on third-party manufacturers for clinical supplies. | Critical supply chain management in place. |
| Financial Risks | Significant ongoing losses and accumulated deficits. | Net losses of $34.0 million for nine months ended September 30, 2024. |
| Strategic Risks | Decisions impacting long-term product focus and viability. | Paused investment in seribantumab to focus on EO-3021. |
Future Growth Prospects for Elevation Oncology, Inc. (ELEV)
Future Growth Prospects for Elevation Oncology, Inc.
Analysis of Key Growth Drivers
The company is actively pursuing several growth drivers to enhance its market position. Key initiatives include:
- Product Innovations: The company focuses on the clinical development of its lead product candidate, EO-3021, which is undergoing advanced preclinical and clinical trials.
- Market Expansion: In September 2024, the company entered a license agreement for technology related to its HER3-ADC program, potentially paving the way for new product introductions.
- Strategic Collaborations: Future development of seribantumab will be undertaken in collaboration with a partner, thereby expanding its operational capabilities.
Future Revenue Growth Projections and Earnings Estimates
Future revenue growth is contingent on successful clinical trials and regulatory approvals. The company has not yet generated revenue, but it expects to incur substantial expenses in its ongoing development activities.
For the nine months ended September 30, 2024, the company reported a net loss of $34.0 million, a slight improvement from a net loss of $37.8 million for the same period in 2023. Research and development expenses amounted to $21.9 million during this period, compared to $20.7 million in 2023.
Strategic Initiatives or Partnerships
Strategic initiatives include:
- License agreement for HER3-ADC technology with potential obligations of up to $365.5 million in development, regulatory, and commercial milestones.
- At-the-market offerings that raised $44.2 million in net proceeds.
Competitive Advantages Positioning for Growth
The company maintains competitive advantages through:
- An extensive intellectual property portfolio that supports its product candidates.
- A focus on niche markets within oncology, particularly targeting genomic alterations.
- Access to substantial capital resources, with cash, cash equivalents, and marketable securities totaling $103.1 million as of September 30, 2024.
| Financial Metric | 2024 (Nine Months) | 2023 (Nine Months) | Change |
|---|---|---|---|
| Net Loss | $34.0 million | $37.8 million | $3.8 million improvement |
| Research and Development Expenses | $21.9 million | $20.7 million | $1.2 million increase |
| Cash, Cash Equivalents, and Marketable Securities | $103.1 million | N/A | N/A |
| Shares Sold (2022 ATM Facility) | 11,625,295 | N/A | N/A |
Elevation Oncology, Inc. (ELEV) DCF Excel Template
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Updated on 16 Nov 2024
Resources:
- Elevation Oncology, Inc. (ELEV) Financial Statements – Access the full quarterly financial statements for Q3 2024 to get an in-depth view of Elevation Oncology, Inc. (ELEV)' financial performance, including balance sheets, income statements, and cash flow statements.
- SEC Filings – View Elevation Oncology, Inc. (ELEV)' latest filings with the U.S. Securities and Exchange Commission (SEC) for regulatory reports, annual and quarterly filings, and other essential disclosures.