Evotec (EVT) AI Stock Analysis

• Market Cap: €1.22B
• Dividend Yield: N/A
• Average Volume (3M): 1.05M
• Price to Earnings (P/E): ―
• Beta (1Y): 1.00
• Revenue Growth: 1.50%
• EPS Growth: -127.76%
• Country: DE
• Employees: 4,766
• Sector: Healthcare
• Sector Strength: 50
• Industry: Drug Manufacturers - Specialty & Generic
• EPS (TTM): -1.17
• Shares Outstanding: 177,763,520
• 10 Day Avg. Volume: 1,250,750
• 30 Day Avg. Volume: 1,052,808
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): 0.00
• Price to Cash Flow (P/CF): 0.00
• P/FCF Ratio: 0.00
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: €10.23
• Price Target Upside: 33.73% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 3

Evotec's overall score is primarily influenced by its financial performance, which shows strong revenue growth but significant profitability challenges. Technical analysis offers some positive momentum signals, but valuation remains a key concern with a negative P/E ratio. Overall, the stock faces considerable hurdles, mainly due to its financial and valuation metrics.

Positive Factors

Business Recovery

Potential upside exists upon business recovery and as focus assets shift to later stages of development.

Debt Management

Despite the net debt leverage ratio reaching 4.3x, management remains confident about meeting upcoming covenants.

Negative Factors

Financial Performance

The net debt leverage ratio reached 4.3x, partly due to worsening EBITDA, indicating additional net debt reduction is needed.

Market Uncertainty

There is uncertainty over the timing of clarity on Evotec's 2025+ trajectory, with a risk that no guidance will be provided soon.

Evotec Business Overview & Revenue Model

Company Description

Evotec SE operates as drug discovery and development partner for the pharmaceutical and biotechnology industry worldwide. The company is developing pharmaceutical products in various therapeutic areas, such as diabetes and complications of diabetes, fibrosis, infectious diseases, CNS diseases, oncology, pain and inflammation, immunology, rare diseases, respiratory diseases, and women's health. It has collaboration agreements with Bayer AG; Lilly; Chinook Therapeutics; Novo Nordisk A/S; Galapagos; Pfizer Inc.; CONBA Pharmaceutical Co., Ltd.; Bristol Myers Squibb Company; Zhejiang JingXin Pharmaceutical Co., Ltd; Kazia Therapeutics; Apeiron Biologics; and Takeda Pharmaceuticals. The company was formerly known as Evotec AG and changed its name to Evotec SE in April 2019. Evotec SE was incorporated in 1993 and is headquartered in Hamburg, Germany.

How the Company Makes Money

Evotec generates revenue through a multi-faceted business model centered around strategic collaborations and service agreements. The company's primary revenue streams include research fees, milestone payments, and royalties from its partnerships with leading pharmaceutical and biotechnology companies. Evotec engages in drug discovery alliances where they provide research services to partners, receiving payments based on the achievement of specific research and development milestones. Additionally, Evotec licenses its proprietary drug candidates to other companies, earning upfront payments and potential royalties on future sales. The company also benefits from long-term partnerships with academic institutions and government agencies, which contribute to its revenue through collaborative research projects and grants.

Evotec Financial Statement Overview

Summary

Evotec's financial performance is mixed. Strong revenue growth is overshadowed by declining profitability and negative cash flow metrics. The balance sheet remains stable but shows signs of strain, such as a declining equity ratio. Focus on improving profitability and cash conversion is needed.

Income Statement

Evotec has experienced consistent revenue growth from 2019 to 2024, but profitability metrics such as net profit margin and EBIT margin have declined significantly, with the company reporting a net loss in recent years. The company had a positive net income in 2021, indicating potential for future recovery, but recent losses weigh heavily on performance.

Balance Sheet

The company's debt-to-equity ratio has remained relatively stable, suggesting manageable leverage levels. However, the equity ratio has decreased over time, and the company has shown a decline in stockholders' equity, indicating potential risks in financial stability. The return on equity has been negative due to net losses in recent years.

Cash Flow

Operating cash flow has been positive, although it has declined significantly compared to prior years. Free cash flow is negative, reflecting high capital expenditures that exceed operating cash generation. The cash flow to net income ratios are not favorable, highlighting challenges in converting earnings to cash.

Breakdown
Dec 2023	Dec 2022	Dec 2021	Dec 2020	Dec 2019
Income Statement		Total Revenue
781.43M	751.45M	618.03M	500.92M	446.44M
	Gross Profit
175.05M	174.06M	151.54M	125.74M	132.89M
	EBIT
-47.51M	12.49M	27.32M	48.52M	62.59M
	EBITDA
7.82M	-86.08M	298.41M	75.50M	86.77M
	Net Income Common Stockholders
-83.91M	-175.66M	215.51M	6.28M	38.16M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
604.11M	729.98M	858.50M	492.22M	321.66M
	Total Assets
2.25B	2.26B	2.24B	1.46B	1.18B
	Total Debt
626.20M	506.67M	512.92M	491.96M	463.10M
	Net Debt
115.29M	91.52M	-186.41M	69.80M	186.06M
	Total Liabilities
1.13B	1.07B	857.48M	740.05M	703.88M
	Stockholders Equity
1.12B	1.19B	1.38B	722.85M	477.03M
Cash Flow		Free Cash Flow
-179.56M	21.75M	3.29M	-54.35M	10.31M
	Operating Cash Flow
36.44M	203.11M	122.24M	44.72M	42.22M
	Investing Cash Flow
-13.29M	-415.82M	-243.85M	-155.09M	-86.63M
	Financing Cash Flow
71.96M	-52.41M	398.43M	246.41M	211.26M

Evotec Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 7.65
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For DE:EVT, the sentiment is Positive. The current price of 7.65 is above the 20-day moving average (MA) of 6.75, above the 50-day MA of 6.63, and above the 200-day MA of 7.29, indicating a bullish trend. The MACD of 0.27 indicates Negative momentum. The RSI at 62.28 is Neutral, neither overbought nor oversold. The STOCH value of 43.38 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for DE:EVT.

Evotec Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
Sector *	52 Neutral	$5.17B	3.59	-42.19%	2.82%	15.05%	-0.04%
EVT	48 Neutral	€1.22B	―	-20.51%	―	1.50%	-127.76%