SAB Biotherapeutics, Inc. (SABS) Bundle
Understanding SAB Biotherapeutics, Inc. (SABS) Revenue Streams
Understanding SAB Biotherapeutics, Inc.’s Revenue Streams
The financial performance of SAB Biotherapeutics, Inc. is primarily influenced by its revenue streams, which arise from various government grants and contract manufacturing activities.
Breakdown of Primary Revenue Sources
For the nine months ended September 30, 2024, the primary revenue sources included:
- Grant Revenue: $1,207,712
- Contract Manufacturing: $0
In comparison, for the nine months ended September 30, 2023, the breakdown was:
- Grant Revenue: $1,933,980
- Contract Manufacturing: $1,414,000
Year-over-Year Revenue Growth Rate
Analyzing the year-over-year revenue growth rate reveals a significant decline:
| Period | Revenue | Change | % Change |
|---|---|---|---|
| Nine Months Ended September 30, 2024 | $1,207,712 | $(726,268) | (37.6%) |
| Nine Months Ended September 30, 2023 | $1,933,980 | N/A | N/A |
Contribution of Different Business Segments to Overall Revenue
The contribution of grant revenue to overall revenue for the nine months ended September 30, 2024, was:
- Grant Revenue Contribution: 100% of total revenue
For the nine months ended September 30, 2023:
- Grant Revenue Contribution: 100% of total revenue
- Contract Manufacturing Contribution: Approximately 73% of total revenue
Analysis of Significant Changes in Revenue Streams
The termination of the JPEO Rapid Response Contract significantly impacted revenue. For the three months ended September 30, 2024, the revenue was:
| Period | Revenue | Change | % Change |
|---|---|---|---|
| Three Months Ended September 30, 2024 | $0 | $(1,267,361) | (100.0%) |
| Three Months Ended September 30, 2023 | $1,267,361 | N/A | N/A |
This stark contrast is primarily attributed to the cessation of contract manufacturing and grant revenue generation activities following the contract termination in 2022. The company anticipates future revenues will remain low as it seeks alternative funding arrangements and partnerships for its pipeline developments.
A Deep Dive into SAB Biotherapeutics, Inc. (SABS) Profitability
A Deep Dive into SAB Biotherapeutics, Inc.'s Profitability
Gross Profit Margin: For the nine months ended September 30, 2024, the total revenue was $1,207,712, with total operating expenses of $34,109,392. This results in a gross profit margin of approximately -2,800%, indicating significant losses relative to revenue due to high operating costs.
Operating Profit Margin: The loss from operations for the nine months ended September 30, 2024, was $(32,901,680), leading to an operating profit margin of -2,726%, compared to the previous year’s loss of $(19,201,549).
Net Profit Margin: The net loss for the nine months ended September 30, 2024, was $(22,710,610), resulting in a net profit margin of -1,884%. This reflects an increase in losses from $(19,337,023) in the same period of the previous year.
Trends in Profitability Over Time
Over the past year, the company has seen a decline in revenue, with total revenue dropping by 37.6% from $1,933,980 in the nine months ended September 30, 2023, to $1,207,712 in 2024. This decline is primarily attributed to the termination of the JPEO Rapid Response Contract.
Comparison of Profitability Ratios with Industry Averages
When comparing the operating profit margin of -2,726% with the industry average, which typically varies between 10% to 20% for biopharmaceutical companies, it is evident that the company is underperforming significantly due to high research and development expenses.
Analysis of Operational Efficiency
The total operating expenses for the nine months ended September 30, 2024, were $34,109,392, which included:
- Research and Development Expenses: $22,599,998
- General and Administrative Expenses: $11,509,394
This indicates a significant increase in R&D expenses by 85.0% compared to $12,217,569 in the previous year, driven largely by increased clinical trial costs and laboratory services. General and administrative expenses also rose by 29.1% from $8,917,960 to $11,509,394.
| Metrics | 2024 (Nine Months) | 2023 (Nine Months) | Change ($) | % Change |
|---|---|---|---|---|
| Total Revenue | $1,207,712 | $1,933,980 | $(726,268) | (37.6%) |
| Operating Expenses | $34,109,392 | $21,135,529 | $(12,973,863) | (61.3%) |
| Loss from Operations | $(32,901,680) | $(19,201,549) | $(13,700,131) | (71.3%) |
| Net Loss | $(22,710,610) | $(19,337,023) | $(3,373,587) | (17.5%) |
Debt vs. Equity: How SAB Biotherapeutics, Inc. (SABS) Finances Its Growth
Debt vs. Equity: How SAB Biotherapeutics, Inc. Finances Its Growth
Debt Levels:
As of September 30, 2024, the company had total liabilities amounting to $16,894,566. This includes a long-term debt of $542,000 from an 8% unsecured convertible note, which was due on September 30, 2024, and was fully repaid during the three months ended September 30, 2024.
Short-term liabilities included accrued expenses totaling $6,879,750.
Debt-to-Equity Ratio:
The debt-to-equity ratio for the company stood at approximately 0.46, calculated using total liabilities of $16,894,566 and total stockholders’ equity of $36,902,617 as of September 30, 2024. This ratio is below the industry average of approximately 0.75, indicating a more conservative capital structure compared to peers.
Recent Debt Issuances:
In October 2023, the company issued 7,500 shares of Series A-1 Preferred Stock, generating gross proceeds of $7.5 million. The proceeds were allocated primarily to working capital and advancing clinical trials. Additionally, the initial value of the associated warrants was estimated at $10.9 million, which was recorded as a liability.
Credit Ratings:
The company has not publicly reported a credit rating from major agencies, reflecting its stage of development and reliance on equity financing.
Debt vs. Equity Financing Balance:
The company primarily relies on equity financing, evidenced by a total paid-in capital of $155,144,947. The recent equity issuance through preferred stock demonstrates the company's strategy to raise capital while maintaining a manageable debt level. The company has historically financed its operations through government grants and equity rather than accumulating significant debt.
| Financial Metric | Amount |
|---|---|
| Total Liabilities | $16,894,566 |
| Long-term Debt | $542,000 |
| Short-term Liabilities | $6,879,750 |
| Total Stockholders' Equity | $36,902,617 |
| Debt-to-Equity Ratio | 0.46 |
| Series A-1 Preferred Stock Proceeds | $7,500,000 |
| Estimated Value of Warrants | $10,900,000 |
Assessing SAB Biotherapeutics, Inc. (SABS) Liquidity
Assessing SAB Biotherapeutics, Inc. Liquidity
Current Ratio: As of September 30, 2024, the current assets amounted to $31.2 million, while current liabilities totaled $6.9 million, resulting in a current ratio of 4.51.
Quick Ratio: The quick assets, excluding inventories, were $30.4 million against current liabilities of $6.9 million, yielding a quick ratio of 4.41.
Analysis of Working Capital Trends
Working capital, defined as current assets minus current liabilities, was calculated at $24.3 million as of September 30, 2024. This indicates an increase from $21.4 million reported at the end of 2023.
| Period | Current Assets ($) | Current Liabilities ($) | Working Capital ($) |
|---|---|---|---|
| September 30, 2024 | 31,200,000 | 6,900,000 | 24,300,000 |
| December 31, 2023 | 28,200,000 | 6,800,000 | 21,400,000 |
Cash Flow Statements Overview
The cash flow from operating activities for the nine months ended September 30, 2024, showed a net cash outflow of $24.8 million, compared to an outflow of $11.7 million for the same period in 2023.
Cash flows from investing activities for the nine months ended September 30, 2024, totaled $(21.3 million), an increase from $(84,840) in 2023.
Cash flows from financing activities resulted in a net cash outflow of $(1.4 million) for 2024, compared to $(863,886) in 2023.
| Cash Flow Activity | 2024 ($) | 2023 ($) |
|---|---|---|
| Operating Activities | (24,759,821) | (11,672,688) |
| Investing Activities | (21,293,033) | (84,840) |
| Financing Activities | (1,389,587) | (863,886) |
| Total Cash Flow | (47,394,891) | (12,621,414) |
Potential Liquidity Concerns or Strengths
As of September 30, 2024, cash and cash equivalents stood at $30.4 million, down from $56.6 million at December 31, 2023. This decrease raises potential liquidity concerns, given the ongoing operational losses.
The company anticipates continued operational losses, necessitating further capital to sustain activities. The accumulated deficit reached $112.8 million as of September 30, 2024, indicating substantial ongoing financial pressure.
In summary, while the current and quick ratios suggest a strong liquidity position, the significant cash outflows and increased reliance on external funding may pose challenges to maintaining this liquidity in the future.
Is SAB Biotherapeutics, Inc. (SABS) Overvalued or Undervalued?
Valuation Analysis
The financial health of the company can be assessed using several key valuation metrics. Below is a detailed breakdown of the company's valuation analysis as of 2024.
Price-to-Earnings (P/E) Ratio
The company reported a net loss of $10,349,410 for the three months ended September 30, 2024, resulting in a basic and diluted loss per share of $(1.12). Consequently, the P/E ratio cannot be calculated as the company is currently not profitable.
Price-to-Book (P/B) Ratio
As of September 30, 2024, the total stockholders' equity was $36,902,617. The book value per share, following a 1:10 reverse stock split, is calculated as:
Book Value Per Share = Total Stockholders' Equity / Shares Outstanding
With 9,229,274 shares outstanding, the book value per share is approximately $4.00. If the stock price is around $0.63, the P/B ratio would be:
P/B Ratio = Stock Price / Book Value Per Share = $0.63 / $4.00 = 0.1575
Enterprise Value-to-EBITDA (EV/EBITDA) Ratio
The enterprise value (EV) is calculated as:
EV = Market Capitalization + Total Debt - Cash and Cash Equivalents
Assuming a market capitalization of approximately $5,800,000 (based on recent stock price), total debt of $16,894,566, and cash and cash equivalents of $9,171,175, the EV is:
EV = $5,800,000 + $16,894,566 - $9,171,175 = $13,523,391
For the EBITDA, given the net loss and operating expenses, a negative EBITDA indicates a challenging financial position. Thus, the EV/EBITDA ratio is not applicable here.
Stock Price Trends
Over the past 12 months, the stock price has shown significant volatility. The recent stock price is approximately $0.63, down from a peak of around $5.60 in 2023. This reflects a substantial decline in investor confidence and market perception.
Dividend Yield and Payout Ratios
The company has not declared any dividends in the past year, resulting in a dividend yield of 0%. The payout ratio is also not applicable due to the absence of dividend payments and ongoing net losses.
Analyst Consensus on Stock Valuation
Analyst ratings indicate a consensus of Hold for the stock, reflecting uncertainty regarding future profitability and growth potential.
| Metric | Value |
|---|---|
| P/E Ratio | N/A (Net Loss) |
| P/B Ratio | 0.1575 |
| EV/EBITDA Ratio | N/A (Negative EBITDA) |
| Current Stock Price | $0.63 |
| Dividend Yield | 0% |
| Analyst Consensus | Hold |
Key Risks Facing SAB Biotherapeutics, Inc. (SABS)
Key Risks Facing SAB Biotherapeutics, Inc. (SABS)
Overview of Internal and External Risks: SAB Biotherapeutics faces several key risks that could impact its financial health. These include:
- Industry Competition: The biopharmaceutical industry is highly competitive, with numerous companies vying for market share in therapeutic areas such as Type 1 diabetes. The company's ability to differentiate its products is crucial.
- Regulatory Changes: Changes in healthcare regulations and drug approval processes could adversely affect the company’s operations and timelines for product development.
- Market Conditions: Economic fluctuations can impact funding availability and investor sentiment, which are critical for ongoing research and development.
Operational Risks: The company has highlighted several operational risks in its recent filings:
- Research and Development Expenses: For the nine months ended September 30, 2024, the company incurred approximately $22.6 million in research and development expenses, a significant increase from $12.2 million in the same period in 2023.
- Net Losses: The net loss for the nine months ended September 30, 2024, was approximately $22.7 million, compared to $19.3 million for the same period in 2023.
- Cash Flow Challenges: The net cash used in operating activities increased by $13.1 million year-over-year, reaching $24.8 million for the nine months ended September 30, 2024.
Financial Risks: Financial risks include:
- Funding Needs: As of September 30, 2024, the company had $30.4 million in cash and cash equivalents, which may not be sufficient to cover its operating expenses for the next twelve months.
- Debt Obligations: The company has an 8% unsecured convertible note with approximately $542,000 principal due on September 30, 2024.
- Accumulated Deficit: The accumulated deficit reached $112.8 million as of September 30, 2024.
| Risk Factor | Details | Financial Impact |
|---|---|---|
| Research and Development Costs | Increased R&D expenses to support product development | $22.6 million (2024) vs. $12.2 million (2023) |
| Net Loss | Continued operational losses | $22.7 million (2024) vs. $19.3 million (2023) |
| Cash Position | Current cash may not sustain operations | $30.4 million as of September 30, 2024 |
| Debt Obligations | Repayment of convertible notes | $542,000 due September 30, 2024 |
| Accumulated Deficit | Long-term financial viability concerns | $112.8 million as of September 30, 2024 |
Mitigation Strategies: The company has indicated plans to mitigate risks through:
- Strategic Partnerships: Exploring partnerships and licensing opportunities to enhance funding and development capabilities.
- Cost Management: Continuing to manage operational expenses while focusing on critical research initiatives.
- Capital Raising Efforts: Plans to seek additional capital through equity or debt financing to support ongoing operations and product development.
Future Growth Prospects for SAB Biotherapeutics, Inc. (SABS)
Future Growth Prospects for SAB Biotherapeutics, Inc.
Key Growth Drivers
The primary growth drivers for the company include:
- Product Innovations: The ongoing development of SAB-142, targeting Type 1 diabetes, showcases the company’s commitment to advancing its product pipeline.
- Market Expansions: The company is exploring potential partnerships and co-development opportunities to enhance its market reach.
- Acquisitions: The potential for strategic acquisitions to bolster product offerings and expand into new markets is a critical growth avenue.
Future Revenue Growth Projections and Earnings Estimates
Revenue for the nine months ended September 30, 2024, was $1,207,712, compared to $1,933,980 for the same period in 2023, reflecting a decrease of 37.6% due to the termination of the JPEO Rapid Response Contract . The company anticipates lower future revenues as it seeks new funding and partnerships.
Strategic Initiatives or Partnerships Driving Future Growth
The company is actively seeking collaborations and licensing arrangements to support the development of its primary pipeline target. This is crucial as it looks to offset the impact of contract terminations on its revenue stream .
Competitive Advantages
The company’s competitive advantages include:
- Strong Research and Development Focus: Research and development expenses reached $22,599,998 for the nine months ended September 30, 2024, up from $12,217,569 in 2023, indicating a robust investment in innovation .
- Technological Expertise: The company possesses unique technology platforms that enhance its product development capabilities.
- Strategic Partnerships: Ongoing discussions for partnerships can provide additional resources and market access.
Financial Overview
The financial health of the company reflects a net loss of $22,710,610 for the nine months ended September 30, 2024, compared to a net loss of $19,337,023 in the same period of 2023 .
| Financial Metric | 2024 (9 Months) | 2023 (9 Months) | Change | % Change |
|---|---|---|---|---|
| Total Revenue | $1,207,712 | $1,933,980 | $(726,268) | (37.6%) |
| Net Loss | $(22,710,610) | $(19,337,023) | $(3,373,587) | 17.4% |
| Research and Development Expenses | $22,599,998 | $12,217,569 | $10,382,429 | 85.0% |
| General and Administrative Expenses | $11,509,394 | $8,917,960 | $2,591,434 | 29.1% |
Liquidity and Capital Resources
As of September 30, 2024, the company had $30.4 million in cash, cash equivalents, and investments, a decrease from $56.6 million at the end of 2023 . The company plans to continue investing in its R&D efforts, which may lead to additional capital requirements in the future.
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Resources:
- SAB Biotherapeutics, Inc. (SABS) Financial Statements – Access the full quarterly financial statements for Q3 2024 to get an in-depth view of SAB Biotherapeutics, Inc. (SABS)' financial performance, including balance sheets, income statements, and cash flow statements.
- SEC Filings – View SAB Biotherapeutics, Inc. (SABS)' latest filings with the U.S. Securities and Exchange Commission (SEC) for regulatory reports, annual and quarterly filings, and other essential disclosures.