Zymeworks (ZYME) AI Stock Analysis

• Market Cap: $822.67M
• Dividend Yield: N/A
• Average Volume (3M): 674.61K
• Price to Earnings (P/E): ―
• Beta (1Y): 1.20
• Revenue Growth: 85.05%
• EPS Growth: 15.96%
• Country: US
• Employees: 299
• Sector: Healthcare
• Sector Strength: 41
• Industry: Biotechnology
• EPS (TTM): -0.30
• Shares Outstanding: 69,683,495
• 10 Day Avg. Volume: 481,726
• 30 Day Avg. Volume: 674,609
• PEG Ratio: 0.95
• Price to Book (P/B): 2.53
• Price to Sales (P/S): 0.00
• P/FCF Ratio: -6.98
• Enterprise Value/Market Cap: 0.90
• Enterprise Value/Revenue: 2.94
• Enterprise Value/Gross Profit: 21.31
• Enterprise Value/Ebitda: -1.65
• 1Y Price Target: $22.00
• Price Target Upside: 87.87% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 9

Zymeworks faces significant financial challenges, with persistent losses and cash flow issues weighing heavily on its score. However, positive recent developments, including FDA approval and strategic partnerships, offer potential upside. Technical indicators are mixed, and the valuation remains a concern due to lack of profitability.

Positive Factors

Analyst Ratings

Analyst coverage has been initiated at an OUTPERFORM rating for ZYME.

Earnings Potential

A positive readout from zanidatamab 1L HER2+ GEA could represent a blockbuster+ opportunity in this indication.

Financial Stability

Zymeworks' balance sheet resources should be sufficient to fund operations into the second half of 2027.

Negative Factors

Financial Performance

Zymeworks recorded a net loss of $0.31 per share, wider than the previously forecasted net loss of $0.12 per share, primarily due to lower-than-expected revenue.

Market Competition

FRa is a crowded target area, which could see overlap with other emerging targets like CDH6, posing a challenge to ZW191.

Regulatory Risks

Risks include clinical trial failures, insufficient efficacy, and inability to obtain timely approval of zanidatamab.

Zymeworks Business Overview & Revenue Model

Company Description

Zymeworks Inc. (ZYME) is a clinical-stage biopharmaceutical company focused on the discovery, development, and commercialization of multifunctional therapeutics. The company operates primarily in the biotechnology sector, leveraging its proprietary platforms to create novel treatments for cancer and other serious diseases. Zymeworks' core products include a pipeline of antibody-based therapeutics, which are designed to address unmet medical needs through innovative approaches to treatment.

How the Company Makes Money

Zymeworks generates revenue through several key channels, primarily through strategic collaborations and licensing agreements with large pharmaceutical companies. These partnerships often involve upfront payments, milestone payments based on the achievement of development and regulatory goals, and royalties on potential sales of commercialized products. Additionally, Zymeworks may receive government grants and funding for research and development activities. The company's innovative technology platforms and promising pipeline attract interest from major players in the pharmaceutical industry, contributing to its earnings potential.

Zymeworks Financial Statement Overview

Summary

Zymeworks faces substantial financial challenges with consistent losses and negative cash flows, despite a strong equity position and cash reserves. Income statement, balance sheet, and cash flow scores reflect these difficulties.

Income Statement

The income statement reveals significant challenges for Zymeworks. The company has experienced negative revenue growth and consistently negative net income, indicating persistent losses. Gross profit margins are also negative, and EBIT and EBITDA margins are unfavorable, highlighting operational inefficiencies. The lack of revenue in the latest reporting period exacerbates these issues.

Balance Sheet

The balance sheet shows a strong equity base with a high equity ratio, demonstrating financial stability. However, the debt-to-equity ratio is moderate, and the company has maintained substantial cash reserves, improving liquidity. Despite these positives, the persistent negative net income impacts return on equity, which remains unfavorable.

Cash Flow

Cash flow analysis shows Zymeworks struggling with negative operating and free cash flows, indicating cash burn. The operating cash flow to net income ratio is insightful but negative due to losses. The company has managed investment activities prudently but needs to improve cash generation from operations to ensure long-term viability.

Breakdown
Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement		Total Revenue
76.30M	76.01M	412.48M	26.68M	38.95M
	Gross Profit
65.11M	-66.98M	203.78M	-172.86M	-131.94M
	EBIT
-119.82M	-138.05M	130.53M	-215.63M	-187.47M
	EBITDA
-105.42M	-120.70M	147.24M	-206.09M	-177.17M
	Net Income Common Stockholders
-122.69M	-118.67M	124.34M	-211.84M	-180.55M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
225.78M	374.33M	492.23M	252.61M	426.35M
	Total Assets
463.09M	580.88M	648.73M	389.13M	538.38M
	Total Debt
18.48B	26.72M	28.11M	32.33M	8.64M
	Net Debt
-47.63B	-130.84M	-372.80M	-169.53M	-233.39M
	Total Liabilities
124.32M	116.07M	155.77M	140.04M	128.45M
	Stockholders Equity
338.77B	464.81M	492.96M	249.09M	409.92M
Cash Flow		Free Cash Flow
-113.11M	-122.38M	130.98M	-205.74M	-157.67M
	Operating Cash Flow
-110.04M	-118.30M	144.11M	-192.45M	-151.40M
	Investing Cash Flow
38.76M	-207.25M	-53.85M	144.60M	-43.44M
	Financing Cash Flow
-20.45M	81.85M	108.58M	8.01M	308.98M

Zymeworks Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 11.71
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For ZYME, the sentiment is Negative. The current price of 11.71 is below the 20-day moving average (MA) of 12.13, below the 50-day MA of 11.88, and below the 200-day MA of 12.94, indicating a bearish trend. The MACD of -0.12 indicates Positive momentum. The RSI at 47.95 is Neutral, neither overbought nor oversold. The STOCH value of 30.26 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for ZYME.

Zymeworks Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
MLYS	53 Neutral	$1.00B	―	-56.31%	―	―	-106.10%
Sector *	52 Neutral	$5.15B	3.02	-44.64%	2.83%	16.44%	-0.47%
ZYME	49 Neutral	$822.67M	―	-29.80%	―	85.05%	15.96%
RCUS	49 Neutral	$906.38M	―	-63.17%	―	-40.51%	-35.07%
NRIX	47 Neutral	$728.81M	―	-64.16%	―	-30.25%	-5.92%
VIR	44 Neutral	$635.89M	―	-44.59%	―	-73.79%	-5.24%
PHVS	42 Neutral	$902.41M	―	-51.85%	―	―	0.71%

Zymeworks Corporate Events

Zymeworks Updates Communication Channels for Stakeholders

Zymeworks announces that it communicates material information through various channels, including filings with the Securities and Exchange Commission, press releases, and social media platforms. The company encourages stakeholders to review these sources for important updates, as they may contain significant information about the company’s operations and product candidates.

Spark’s Take on ZYME Stock

According to Spark, TipRanks’ AI Analyst, ZYME is a Neutral.

Zymeworks’ stock score is primarily hindered by ongoing financial challenges, including persistent losses and valuation concerns. However, positive technical and strategic developments, such as FDA approvals and partnerships, provide a counterbalance. The company needs to address its fundamental weaknesses to unlock greater stock potential.

To see Spark’s full report on ZYME stock, click here.

Zymeworks Achieves FDA Approval for Ziihera®

Zymeworks reported its financial results for the fourth quarter and full year 2024, highlighting significant advancements in its product pipeline, including the initiation of first-in-human studies for ZW191 and ZW171. The company also announced the FDA’s accelerated approval of Ziihera® for HER2-positive biliary tract cancer, marking a major milestone for its partnered product. With a strong cash position and anticipated regulatory milestone payments, Zymeworks projects a cash runway into the second half of 2027, supporting its continued development efforts and strategic partnerships.