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Arrowhead Pharmaceuticals, Inc. (ARWR)
:ARWR
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Arrowhead Pharmaceuticals
(NASDAQ:ARWR)
50Neutral
Positive Factors
Clinical Data
ARO-C3 led to deep and sustained reductions in alternative pathway complement activity and proteinuria, which supports its potential to become a blockbuster program.
Financial Stability
ARWR is well-capitalized with $1.1B in cash, funded into 2028, and started to pay down the $400mm term loan with cash inflows from the collaboration.
Product Pipeline
The expected approval of plozasiran as a treatment for FCS is anticipated to mark a new era for Arrowhead, positioning it as a competitive ApoC3-lowering agent with favorable dosing and safety profile.
Negative Factors
Market Limitations
There is a low ceiling for shares in the short term due to limited upside for the FCS launch.
Arrowhead Pharmaceuticals (ARWR) vs. S&P 500 (SPY)
Market Cap
$2.17B
Dividend YieldN/A
Average Volume (3M)2.02M
Price to Earnings (P/E)―
Beta (1Y)2.34
Revenue Growth1436.97%
EPS Growth68.03%
CountryUS
Employees609
SectorHealthcare
Sector Strength41
IndustryBiotechnology
Share Statistics
EPS (TTM)2.75
Shares Outstanding138,100,430
10 Day Avg. Volume1,973,749
30 Day Avg. Volume2,024,932
Financial Highlights & Ratios
PEG Ratio0.62
Price to Book (P/B)30.93
Price to Sales (P/S)0.00
P/FCF Ratio-3.13
Enterprise Value/Market Cap1.04
Enterprise Value/Revenue36.96
Enterprise Value/Gross Profit-187.73
Enterprise Value/Ebitda-1.08
Forecast
1Y Price Target
$39.90Price Target Upside153.98% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering12
Arrowhead Pharmaceuticals Business Overview & Revenue Model
Company DescriptionArrowhead Pharmaceuticals, Inc. develops medicines for the treatment of intractable diseases in the United States. The company's products in pipeline includes ARO-AAT, a RNA interference (RNAi) therapeutic candidate that is in Phase II clinical trial for the treatment of liver diseases associated with alpha-1 antitrypsin deficiency; ARO-APOC3, which is in phase 2b and one phase 3 clinical trial to treat hypertriglyceridemia; ARO-ANG3 that is in Phase 2b clinical trial to reduce production of angiopoietin-like protein 3; ARO-HSD, which is in Phase 1/2a clinical trial to treat liver diseases; ARO-ENaC, which is in a Phase 1/2a clinical trial to reduce production of the epithelial sodium channel alpha subunit in the airways of the lung; ARO-C3 for the treatment of complement-mediated disease that is in Phase 1/2a clinical trial; ARO-Lung2 for the treatment of chronic obstructive pulmonary disorder; ARO-DUX4 for the treatment of facioscapulohumeral muscular dystrophy; ARO-XDH to treat uncontrolled gout; ARO-COV for the treatment of COVID-19 and other pulmonary-borne pathogens; and ARO-HIF2, which is in phase 1b clinical trial to treat clear cell renal cell carcinoma. It is also involved in the development of JNJ-3989, a subcutaneously administered RNAi therapeutic candidate to treat chronic hepatitis B virus infection; Olpasiran to reduce the production of apolipoprotein A; and ARO-AMG1 for treating genetically validated cardiovascular targets. Arrowhead Pharmaceuticals, Inc. has a license and research collaboration agreement with Janssen Pharmaceuticals, Inc. to develop ARO-JNJ1, ARO-JNJ2, and ARO-JNJ3 RNAi therapeutics for liver-expressed targets; and license and research collaboration agreement with Takeda Pharmaceuticals U.S.A., Inc. to develop RNAi therapeutic candidate as a treatment for liver disease. Arrowhead Pharmaceuticals, Inc. was incorporated in 1989 and is headquartered in Pasadena, California.
How the Company Makes MoneyArrowhead Pharmaceuticals generates revenue primarily through collaboration and license agreements with larger pharmaceutical companies. These partnerships often involve upfront payments, milestone payments based on the achievement of development, regulatory, and commercial goals, as well as royalties on sales of any successfully commercialized products. The company's strategic collaborations allow it to leverage the expertise and distribution networks of its partners while focusing on its core competencies in drug discovery and development. Significant partnerships with companies such as Janssen Pharmaceuticals and Amgen have been instrumental in driving revenue growth. Additionally, Arrowhead may earn revenue from government grants and other funding sources, although these are not the primary drivers of its financial performance.
Arrowhead Pharmaceuticals Financial Statement Overview
Summary
Arrowhead Pharmaceuticals faces significant financial challenges with negative profitability and cash flow metrics. The company's increasing leverage and dependence on external financing underscore the need for strategic improvements to enhance financial sustainability. Continued monitoring of revenue growth and profitability trends is critical for assessing long-term viability.Income Statement
Arrowhead Pharmaceuticals exhibits a challenging income statement profile. The company reports negative gross profit margins, indicating that its costs exceed revenues. The net profit margin is also deeply negative, driven by substantial losses, highlighting significant profitability challenges. Revenue growth was volatile, with a sharp decline in the most recent TTM period compared to the previous year.30
Negative
Balance Sheet
The balance sheet shows a mixed picture. The debt-to-equity ratio has increased over time, reflecting rising leverage. Return on equity is negative due to consistent net losses. However, the company maintains a reasonable equity ratio, suggesting some stability in assets to equity. Overall, there is room for improvement in financial stability.45
Neutral
Cash Flow
Cash flow analysis reveals negative operating and free cash flows, indicating cash burn and potential liquidity pressures. Free cash flow growth is negative, and both operating and free cash flow to net income ratios are unfavorable due to operating losses. The company relies heavily on financing activities to support cash needs, suggesting potential future financing risks.40
Negative
| Breakdown | |||||
| TTM | Sep 2024 | Sep 2023 | Sep 2022 | Sep 2021 | Sep 2020 |
|---|---|---|---|---|---|
| Income Statement | Total Revenue | ||||
| 2.50M | 3.55M | 240.74M | 243.23M | 138.29M | 87.99M | Gross Profit |
| -12.04M | 3.55M | 240.74M | 232.81M | 138.29M | 87.99M | EBIT |
| -625.95M | -601.08M | -205.00M | -178.51M | -149.04M | -93.16M | EBITDA |
| -580.69M | -561.51M | -175.67M | -162.29M | -132.58M | -87.22M | Net Income Common Stockholders |
| -639.71M | -599.49M | -205.28M | -176.49M | -140.85M | -84.55M |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | ||||
| 552.93M | 680.96M | 403.63M | 376.40M | 367.79M | 315.49M | Total Assets |
| 1.01B | 1.14B | 765.55M | 691.94M | 710.15M | 522.50M | Total Debt |
| 525.27M | 510.55M | 115.17M | 81.58M | 25.55M | 21.14M | Net Debt |
| 471.38M | 407.87M | 4.28M | -26.43M | -158.89M | -122.44M | Total Liabilities |
| 957.62M | 948.74M | 478.39M | 585.98M | 301.33M | 60.72M | Stockholders Equity |
| 52.59M | 185.44M | 271.34M | 105.96M | 408.82M | 461.78M |
| Cash Flow | Free Cash Flow | ||||
| -571.61M | -604.32M | -330.63M | -188.91M | 147.66M | -107.34M | Operating Cash Flow |
| -491.28M | -462.85M | -153.89M | -136.13M | 171.22M | -95.39M | Investing Cash Flow |
| -408.00M | -420.07M | -96.16M | -5.42M | -141.68M | -240.78M | Financing Cash Flow |
| 890.89M | 870.52M | 253.05M | 65.19M | 11.30M | 257.95M |
Arrowhead Pharmaceuticals Technical Analysis
Positive
15.71
Price Trends
13.59
Positive
16.51
Negative
19.09
Negative
Market Momentum
0.46
Negative
63.95
Neutral
65.60
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For ARWR, the sentiment is Positive. The current price of 15.71 is above the 20-day moving average (MA) of 13.75, above the 50-day MA of 13.59, and below the 200-day MA of 19.09, indicating a neutral trend. The MACD of 0.46 indicates Negative momentum. The RSI at 63.95 is Neutral, neither overbought nor oversold. The STOCH value of 65.60 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for ARWR.
Arrowhead Pharmaceuticals Risk Analysis
Arrowhead Pharmaceuticals disclosed 65 risk factors in its most recent earnings report. Arrowhead Pharmaceuticals reported the most risks in the “Tech & Innovation” category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Arrowhead Pharmaceuticals Peers Comparison
Overall Rating
UnderperformOutperform
Sector (52)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
63 Neutral | $1.52B | ― | -5.78% | ― | 25.50% | 64.63% | |
54 Neutral | $1.97B | ― | -32.17% | ― | -25.85% | -23.89% | |
54 Neutral | $1.69B | 2.59 | 60.26% | ― | 25.96% | ― | |
52 Neutral | $5.15B | 3.02 | -44.64% | 2.82% | 16.45% | -0.47% | |
50 Neutral | $2.17B | ― | -24.67% | ― | 1436.97% | 68.03% | |
45 Neutral | $1.80B | ― | -38.04% | ― | -82.38% | -164.76% | |
43 Neutral | $1.67B | ― | -23.34% | ― | ― | -14.19% |
* Healthcare Sector Average
Performance Comparison
ARWR
Arrowhead Pharmaceuticals
15.71
-9.11
-36.70%
AGIO
Agios Pharma
29.18
-4.01
-12.08%
BEAM
Beam Therapeutics
17.89
-6.95
-27.98%
IRON
Disc Medicine
48.09
15.72
48.56%
KYMR
Kymera Therapeutics
30.25
-5.76
-16.00%
IMCR
Immunocore Holdings
30.37
-22.78
-42.86%
Arrowhead Pharmaceuticals Earnings Call Summary
Earnings Call Date:May 12, 2025
(Q2-2025)
| % Change Since: 12.46%|
Next Earnings Date:Aug 11, 2025
Earnings Call Sentiment Positive
Arrowhead Pharmaceuticals demonstrated strong financial performance and significant progress in its pipeline, particularly with the upcoming launch of Plozasiran and promising data from clinical trials. However, the company faces regulatory uncertainties and market challenges, with a heavy reliance on partnerships for future revenue. The sentiment is generally positive due to the outweighing highlights.Q2-2025 Updates
Positive Updates
Strong Financial Performance
Arrowhead reported a net income of $370.4 million for the quarter ended March 31, 2025, compared to a net loss of $125.3 million in the same period of 2024. Revenue for the quarter was $542.7 million, primarily due to the license and collaboration agreement with Sarepta.
Upcoming Launch of Plozasiran
Arrowhead is preparing for the commercial launch of Plozasiran for Familial Chylomicronemia Syndrome (FCS), with a PDUFA date set for November 18, 2025. The company is building its commercial sales team and engaging with payers in anticipation of launch.
Advanced Pipeline and Partnerships
The company highlighted its advanced pipeline with multiple Phase III programs, including SHASTA-3, SHASTA-4, and MUIR-3 for severe hypertriglyceridemia (SHTG) and partnerships with Sarepta and Takeda. The Sarepta deal brought in $500 million upfront and potential milestones exceeding $11 billion.
Encouraging Clinical Data
Plozasiran showed reductions in triglycerides by about 80% from baseline in Phase III studies. The company is also seeing progress with obesity candidates ARO-INHBE and ARO-ALK7, with expected initial data by the end of 2025.
Negative Updates
Regulatory and Market Challenges
The regulatory environment remains uncertain, and the company has not yet received feedback on potential labeling from the FDA. Additionally, the biotech market remains depressed, affecting capital market conditions.
Dependency on Partnerships
Significant revenue and future potential are tied to partnerships, particularly with Sarepta, which may affect long-term independence and strategic direction.
Uncertainty in CNS Program
While the CNS platform shows promise, it is not yet validated in humans. The company is betting on the platform translating successfully from animal models to human clinical trials.
Company Guidance
During the Arrow Pharmaceuticals Conference Call, management provided a comprehensive update on the company's progress and future plans. The key highlight was the anticipated commercial launch of plozasiran, a potent triglyceride-lowering agent, later this year, pending regulatory approval. The PDUFA date is set for November 18, 2025, with a Marketing Authorization Application (MAA) submitted to the EMA. Phase III data showed impressive triglyceride reductions of about 80%, with 75% and 50% of patients achieving triglyceride levels below 880 and 500 milligrams per deciliter, respectively. Arrowhead plans to expand into the broader severe hypertriglyceridemia (SHTG) market, with ongoing SHASTA-3, SHASTA-4, and MUIR 3 studies expected to complete enrollment this summer. The company is also advancing its obesity candidates, ARO-INHBE and ARO-ALK7, with initial data expected by the end of 2025. Arrowhead's CNS platform is progressing, with the first candidate targeting the Tau protein for Alzheimer's disease expected to enter the clinic late this year. Financially, the company is strong, with $1.1 billion in cash and investments and a recent deal with Sarepta Therapeutics contributing $825 million in upfront payments and equity investment, supporting operations into 2028.Arrowhead Pharmaceuticals Corporate Events
Executive/Board ChangesBusiness Operations and Strategy
Arrowhead Pharmaceuticals Announces New CFO Appointment
Positive
Apr 15, 2025
Arrowhead Pharmaceuticals announced the retirement of its Chief Financial Officer, Ken Myszkowski, effective May 13, 2025, after 16 years of service. He will continue as an employee adviser until January 31, 2026, to ensure a smooth transition. Daniel Apel, formerly of Walgreens Boots Alliance and Bayer, will succeed Myszkowski as CFO. Apel’s appointment comes as Arrowhead transitions from a development stage to a commercial stage, with plans to launch plozasiran pending regulatory approval. This leadership change is expected to support Arrowhead’s ambitious development and commercialization plans.
Spark’s Take on ARWR Stock
According to Spark, TipRanks’ AI Analyst, ARWR is a Neutral.
Arrowhead Pharmaceuticals has a challenging financial profile with negative profitability and cash flow metrics, as well as a bearish technical outlook. However, the positive sentiment from the recent earnings call, highlighted by a substantial collaboration with Sarepta Therapeutics and a strong cash position, provides potential for future growth. The stock’s valuation is currently unattractive due to negative earnings, but strategic initiatives and upcoming product launches could improve its financial standing.
To see Spark’s full report on ARWR stock, click here.
Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.