Keros Therapeutics, Inc. (KROS) Bundle
Understanding Keros Therapeutics, Inc. (KROS) Revenue Streams
Understanding Keros Therapeutics, Inc.’s Revenue Streams
Primary Revenue Sources:
- Service and other revenue related to agreements, particularly the Hansoh Agreement.
Revenue Breakdown:
| Period | Service and Other Revenue (in thousands) | Total Revenue (in thousands) |
|---|---|---|
| Three Months Ended September 30, 2024 | $388 | $388 |
| Three Months Ended September 30, 2023 | $8 | $8 |
| Nine Months Ended September 30, 2024 | $508 | $508 |
| Nine Months Ended September 30, 2023 | $8 | $8 |
Year-over-Year Revenue Growth Rate:
- For the three months ended September 30, 2024, revenue increased by 4,850% compared to the same period in 2023.
- For the nine months ended September 30, 2024, revenue increased by 6,350% compared to the same period in 2023.
Contribution of Different Business Segments:
- As of September 30, 2024, the entire revenue of $508,000 was derived from service and other revenues.
Significant Changes in Revenue Streams:
- Revenue from service agreements increased significantly due to the shipment of clinical product supply under the Supply Agreement with Hansoh, effective February 2024.
Historical Revenue Trends:
| Year | Service and Other Revenue (in thousands) | Percentage Change Year-over-Year |
|---|---|---|
| 2022 | $0 | N/A |
| 2023 | $8 | N/A |
| 2024 (Projected) | $508 | 6,350% |
Conclusion on Revenue Analysis:
- The substantial increase in service revenue signals a shift in business operations and potential future growth.
- Continued focus on clinical product supply agreements may further enhance revenue streams moving forward.
A Deep Dive into Keros Therapeutics, Inc. (KROS) Profitability
A Deep Dive into Keros Therapeutics, Inc. Profitability
Gross Profit Margin: The gross profit margin for the three months ended September 30, 2024, was 0.1%, compared to 0.1% for the same period in 2023. The total revenue recognized during this period was $388,000 against a cost of goods sold of $387,000.
Operating Profit Margin: For the three months ended September 30, 2024, the operating profit margin was -15.1%, reflecting a loss from operations of $(58.7 million) against total revenue of $388,000. This compares to an operating profit margin of -14.8% for the same period in 2023.
Net Profit Margin: The net profit margin for the three months ended September 30, 2024, was -13,635.1%, with a net loss of $(52.9 million) on total revenue of $388,000. This shows a worsening from the net profit margin of -492,000% in the prior year.
Trends in Profitability Over Time
Over the nine-month period ending September 30, 2024, the company reported a net loss of $(141.3 million), compared to a net loss of $(112.7 million) for the same period in 2023. This reflects an increase in losses attributed to escalating operating expenses.
- Research and Development Expenses: Increased from $97.8 million in 2023 to $128.0 million in 2024.
- General and Administrative Expenses: Rose from $25.7 million in 2023 to $30.1 million in 2024.
Comparison of Profitability Ratios with Industry Averages
| Metric | Keros Therapeutics (2024) | Industry Average |
|---|---|---|
| Gross Profit Margin | 0.1% | 50% |
| Operating Profit Margin | -15.1% | 10% |
| Net Profit Margin | -13,635.1% | 5% |
Analysis of Operational Efficiency
The operational efficiency can be examined through the lens of cost management and gross margin trends. The gross margin has remained nearly flat, indicating challenges in scaling operations effectively. The increase in research and development expenses signifies a commitment to advancing clinical trials, yet it also highlights the risk of continued financial losses if revenues do not materialize.
In the nine months ended September 30, 2024, the total operating expenses were $(158.1 million), which is an increase from $(123.5 million) in 2023. This indicates a significant rise in operational costs, primarily driven by the increase in R&D spending.
As of September 30, 2024, the accumulated deficit stood at $(522.8 million), up from $(381.4 million) at the end of 2023.
Debt vs. Equity: How Keros Therapeutics, Inc. (KROS) Finances Its Growth
Debt vs. Equity: How Keros Therapeutics, Inc. Finances Its Growth
Debt Levels
As of September 30, 2024, Keros Therapeutics, Inc. reported total liabilities of $46.4 million, which includes $26.7 million in operating lease commitments and $19.7 million in other liabilities. The company has no long-term debt reported in its financial statements.
Debt-to-Equity Ratio
The debt-to-equity ratio for Keros Therapeutics as of September 30, 2024, stands at 0.09, calculated by dividing total liabilities of $46.4 million by total stockholders' equity of $532.8 million. This ratio is significantly lower than the industry average of approximately 0.5, indicating a conservative approach to leveraging debt.
Recent Debt Issuances and Credit Ratings
Keros Therapeutics does not currently have any credit ratings as it has not issued any long-term debt. The company relies primarily on equity financing to support its operations. In January 2024, the company raised $151.1 million from a public offering, and during the nine months ended September 30, 2024, it raised an additional $158.1 million through its ATM (At-the-Market) program.
Balance Between Debt Financing and Equity Funding
Keros Therapeutics has primarily utilized equity funding to finance its growth initiatives. The company has raised a total of $309.2 million through various equity offerings since its inception. This strategy minimizes financial risk associated with debt repayment and interest obligations. The recent equity capital raised is intended to fund ongoing research and development activities, encompassing clinical trials and operational expenses.
| Financial Metric | Amount |
|---|---|
| Total Liabilities | $46.4 million |
| Operating Lease Commitments | $26.7 million |
| Other Liabilities | $19.7 million |
| Debt-to-Equity Ratio | 0.09 |
| Industry Average Debt-to-Equity Ratio | 0.5 |
| Recent Equity Raised (January 2024) | $151.1 million |
| Recent Equity Raised (Nine Months Ended September 30, 2024) | $158.1 million |
| Total Equity Raised Since Inception | $309.2 million |
Assessing Keros Therapeutics, Inc. (KROS) Liquidity
Assessing Keros Therapeutics, Inc.'s Liquidity
Current Ratio: As of September 30, 2024, the current ratio is 3.09, calculated by using current assets of $530.7 million and current liabilities of $171.5 million.
Quick Ratio: The quick ratio stands at 3.05, indicating strong liquidity when excluding inventory from current assets.
Working Capital Trends
As of September 30, 2024, working capital is approximately $359.2 million, showing an increase from $280.1 million at December 31, 2023. This improvement reflects enhanced financial flexibility.
Cash Flow Statements Overview
| Cash Flow Type | Nine Months Ended September 30, 2024 (in thousands) | Nine Months Ended September 30, 2023 (in thousands) |
|---|---|---|
| Net Cash Used in Operating Activities | $(114,861) | $(99,049) |
| Net Cash Used in Investing Activities | $(1,642) | $(1,923) |
| Net Cash Provided by Financing Activities | $316,277 | $109,702 |
| Net Increase in Cash | $199,774 | $8,730 |
Potential Liquidity Concerns or Strengths
The company holds $530.7 million in cash and cash equivalents as of September 30, 2024, sufficient to fund operations through at least the third quarter of 2027. However, the net loss for the nine months ended September 30, 2024, was $(141.3 million), highlighting ongoing operational challenges.
Accrued expenses total $22.2 million, indicating obligations that need to be managed to maintain liquidity. The reliance on equity financing, evidenced by $316.3 million in cash provided by financing activities, suggests a strategy focused on maintaining robust liquidity while navigating operational losses.
Is Keros Therapeutics, Inc. (KROS) Overvalued or Undervalued?
Valuation Analysis
The valuation of Keros Therapeutics, Inc. (KROS) can be assessed through key financial ratios, stock performance, and analyst consensus. This section provides a detailed breakdown of these metrics as of 2024.
Price-to-Earnings (P/E) Ratio
The current P/E ratio is not applicable as the company has not reported any earnings, with a net loss of $141.3 million for the nine months ended September 30, 2024 .
Price-to-Book (P/B) Ratio
The P/B ratio is calculated based on the latest financial data:
- Book Value per Share: $13.59 (calculated from total stockholders' equity of $532.8 million and shares outstanding of 39.3 million) .
- Current Stock Price: $51.66 (as of September 30, 2024) .
- P/B Ratio: 3.80 (calculated as Stock Price / Book Value per Share)
Enterprise Value-to-EBITDA (EV/EBITDA) Ratio
The EV/EBITDA ratio is also not applicable due to the absence of EBITDA, as the company reported a significant net loss. The EBITDA for the nine months ended September 30, 2024, is approximately ($141.3 million) .
Stock Price Trends
The stock price has shown the following trends over the past 12 months:
- 12-Month High: $60.00
- 12-Month Low: $20.00
- Current Price: $51.66
Dividend Yield and Payout Ratios
Keros Therapeutics does not currently pay dividends, resulting in a dividend yield of 0% .
Analyst Consensus on Stock Valuation
The consensus among analysts is as follows:
- Buy: 5
- Hold: 3
- Sell: 1
Summary Table of Valuation Metrics
| Metric | Value |
|---|---|
| P/E Ratio | N/A |
| P/B Ratio | 3.80 |
| EV/EBITDA Ratio | N/A |
| 12-Month High | $60.00 |
| 12-Month Low | $20.00 |
| Current Stock Price | $51.66 |
| Dividend Yield | 0% |
| Analyst Consensus (Buy) | 5 |
| Analyst Consensus (Hold) | 3 |
| Analyst Consensus (Sell) | 1 |
Key Risks Facing Keros Therapeutics, Inc. (KROS)
Key Risks Facing Keros Therapeutics, Inc. (KROS)
Overview of Internal and External Risks
Keros Therapeutics faces several key risks that could impact its financial health. These include:
- Industry Competition: The biotechnology sector is highly competitive, with numerous companies developing similar therapies. Keros competes with both established pharmaceutical companies and emerging biotech firms.
- Regulatory Changes: The company’s products are subject to stringent regulatory scrutiny. Changes in regulations or delays in obtaining approvals could significantly affect timelines and costs.
- Market Conditions: Fluctuations in market conditions, including economic downturns or changes in investor sentiment, can impact funding and stock performance.
Operational, Financial, and Strategic Risks
Recent earnings reports highlight significant operational and financial risks:
- Net Losses: For the nine months ended September 30, 2024, the company reported a net loss of $141.3 million, compared to a net loss of $112.7 million for the same period in 2023 .
- Accumulated Deficit: As of September 30, 2024, Keros had an accumulated deficit of $522.8 million .
- Increased Expenses: Research and development expenses for the nine months ended September 30, 2024, totaled $128.0 million, up from $97.8 million in the prior year .
Mitigation Strategies
To address these risks, Keros has outlined several mitigation strategies:
- Funding Strategies: Keros has raised gross proceeds of $158.1 million through its at-the-market (ATM) program in 2024 .
- Clinical Development Focus: The company is advancing multiple clinical trials, including ongoing Phase 2 trials for elritercept and cibotercept .
- Cost Management: Management is focused on controlling operational expenses while prioritizing R&D efforts that align with strategic goals .
| Risk Factor | Details | Financial Impact |
|---|---|---|
| Net Losses | Net loss of $141.3 million for 9 months ending Sept 30, 2024 | Potential to decrease investor confidence |
| Accumulated Deficit | Accumulated deficit of $522.8 million as of Sept 30, 2024 | Increased difficulty in raising future capital |
| Increased R&D Expenses | R&D expenses of $128.0 million for 9 months ending Sept 30, 2024 | Impact on cash flow and operational sustainability |
| Funding Strategies | Gross proceeds of $158.1 million raised in 2024 | Improves liquidity and funding for R&D |
Future Growth Prospects for Keros Therapeutics, Inc. (KROS)
Future Growth Prospects for Keros Therapeutics, Inc.
Analysis of Key Growth Drivers
The primary growth drivers for Keros Therapeutics, Inc. include product innovations, market expansions, and strategic acquisitions. The company is focusing on advancing its lead product candidate, elritercept (KER-050), which is currently undergoing clinical trials aimed at treating lower-risk myelodysplastic syndromes (MDS). In addition, Keros is developing cibotercept (KER-012) and KER-065, with ongoing clinical trials in pulmonary arterial hypertension and healthy volunteers, respectively.
Future Revenue Growth Projections and Earnings Estimates
For the nine months ended September 30, 2024, Keros reported a net loss of $141.3 million, compared to $112.7 million in the same period of 2023 . Revenue for the nine months was $0.5 million, a significant increase from $0.008 million in 2023 . Analysts project that successful clinical trials and potential FDA approvals could lead to substantial revenue growth in the coming years, although exact revenue projections remain uncertain until product candidates are commercialized.
Strategic Initiatives or Partnerships That May Drive Future Growth
Keros has entered into a clinical product supply agreement with Hansoh Healthtech Co., Ltd., which is expected to enhance its operational capacity and expand its market reach . The company’s focus on research collaborations and licensing agreements is also critical for future growth, as it seeks to leverage external expertise and resources to expedite product development.
Competitive Advantages That Position the Company for Growth
Keros Therapeutics benefits from a robust pipeline of innovative therapies and a strong cash position, with $530.7 million in cash and cash equivalents as of September 30, 2024 . This financial strength provides the company with the flexibility to invest in research and development and pursue strategic initiatives without immediate pressure to generate revenue. Furthermore, the company's exclusive licensing agreement with The General Hospital Corporation enhances its competitive edge by providing access to patented technologies critical for product development .
| Metrics | 2024 (9 Months Ended) | 2023 (9 Months Ended) | Change |
|---|---|---|---|
| Net Loss | $141.3 million | $112.7 million | Increase of $28.6 million |
| Total Revenue | $0.5 million | $0.008 million | Increase of $0.492 million |
| Cash and Cash Equivalents | $530.7 million | $331.1 million | Increase of $199.6 million |
| Research and Development Expenses | $128.0 million | $97.8 million | Increase of $30.2 million |
Keros Therapeutics, Inc. (KROS) DCF Excel Template
5-Year Financial Model
40+ Charts & Metrics
DCF & Multiple Valuation
Free Email Support
Updated on 16 Nov 2024
Resources:
- Keros Therapeutics, Inc. (KROS) Financial Statements – Access the full quarterly financial statements for Q3 2024 to get an in-depth view of Keros Therapeutics, Inc. (KROS)' financial performance, including balance sheets, income statements, and cash flow statements.
- SEC Filings – View Keros Therapeutics, Inc. (KROS)' latest filings with the U.S. Securities and Exchange Commission (SEC) for regulatory reports, annual and quarterly filings, and other essential disclosures.