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Emergent Biosolutions (EBS)
NYSE:EBS

Emergent Biosolutions (EBS) AI Stock Analysis

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Emergent Biosolutions

(NYSE:EBS)

Rating:52Neutral
Price Target:
$6.50
▲(4.17%Upside)
The overall stock score of 51.75 reflects the financial and operational challenges faced by Emergent BioSolutions. Despite some positive developments in earnings and strategic contracts, the company's current financial instability, negative valuation metrics, and mixed technical indicators weigh heavily on the score.
Positive Factors
Contracts and Agreements
The establishment of a three-year agreement valued at about $65M to supply the Ontario Ministry of Health with NARCAN Nasal Spray highlights the company's strong contracting capabilities.
Earnings
The company recorded $68M in net income for the quarter, significantly ahead of the expectation for net income of only $14.9M.
Financial Performance
Emergent has now lowered its net leverage ratio to 2.8x from 5.7x one year ago, and increased its combined liquidity to $250 million including cash and revolver from $79 million one year ago.
Negative Factors
Competitive Risks
Risks include faster-than-anticipated NARCAN franchise erosion due to greater-than-anticipated levels of generic competition.
Market Performance
Investors should note that Emergent shares are down roughly 49% compared to a roughly 10% decline in the benchmark XBI index.
Revenue
Revenue was moderately below forecast, raising concerns about meeting future expectations.

Emergent Biosolutions (EBS) vs. SPDR S&P 500 ETF (SPY)

Emergent Biosolutions Business Overview & Revenue Model

Company DescriptionEmergent BioSolutions Inc. (EBS) is a global life sciences company focused on providing specialty products to address public health threats. The company operates in the biotechnology sector and is known for its development, manufacturing, and distribution of vaccines, therapeutics, and other medical products. Emergent's core products include vaccines for anthrax and smallpox, as well as treatments for opioid overdose and chemical threats.
How the Company Makes MoneyEmergent BioSolutions generates revenue through the sale of its medical countermeasures, which are primarily purchased by government agencies as part of national defense and public health preparedness strategies. Key revenue streams include contracts with the U.S. government for the procurement of anthrax and smallpox vaccines, as well as agreements for the supply of Narcan, an opioid overdose reversal drug. The company also engages in partnerships and collaborations with other pharmaceutical companies and government entities to develop and manufacture new products, further enhancing its revenue potential. Additionally, Emergent earns income from contract development and manufacturing services offered to other biopharmaceutical companies.

Emergent Biosolutions Earnings Call Summary

Earnings Call Date:May 07, 2025
(Q1-2025)
|
% Change Since: 31.65%|
Next Earnings Date:Aug 12, 2025
Earnings Call Sentiment Neutral
The earnings call presented a mix of positive and negative elements. While the company reported strong improvements in financial metrics, international revenue growth, and strategic agreements, challenges such as a decline in total revenue and specific issues with NARCAN sales were highlighted. The overall sentiment reflects a balanced outlook with significant achievements offset by notable challenges.
Q1-2025 Updates
Positive Updates
Improved Financial Position
Emergent BioSolutions improved its cash position, ending Q1 2025 with $149 million on the balance sheet and a total liquidity of $250 million, including a fully undrawn revolver. Net leverage reduced to 2.8x adjusted EBITDA from 5.7x in Q1 2024.
International Revenue Growth
International sales accounted for $91 million of total revenue, representing about 40% of overall revenue and 60% of medical countermeasures revenue, indicating significant diversification and growth outside the U.S.
Significant Margin Expansion
Adjusted EBITDA margin improved by 1,300 basis points to 35%, and adjusted gross margin increased by 700 basis points year-over-year.
Large Contract with Ontario Ministry of Health
A 3-year agreement valued at approximately $65 million was signed with the Province of Ontario for supplying NARCAN, demonstrating continued demand and support for Emergent's opioid overdose reversal treatments.
Strong Start to 2025
Net income for Q1 2025 was $68 million, a 656% increase compared to Q1 2024, highlighting significant financial improvement.
Negative Updates
Decline in Total Revenue
Total revenues decreased to $222 million, impacted by lower NARCAN and BAT sales, as well as divestitures of RSDL and Camden, partially offset by higher international smallpox sales.
Challenges with NARCAN Sales
NARCAN revenue was impacted by reduced pricing in the public interest space, a one-time sale of short-dated generic naloxone, and delays in procurement due to federal administration transitions.
Projected Revenue Decline in Q2 2025
Q2 2025 revenue is forecasted between $95 million to $120 million, suggesting a sequential decline, with profitability expected to decline significantly compared to Q1.
Company Guidance
During the first quarter of 2025, Emergent BioSolutions reaffirmed its outlook and guidance for the full year, projecting total revenues between $750 million and $850 million and adjusted EBITDA ranging from $150 million to $200 million. The company reported a strong start to the year with first-quarter revenues of $222 million and an adjusted EBITDA of $78 million, marking an increase of $11 million compared to the previous year. Emergent's net income for the quarter was $68 million, a substantial 656% increase from the first quarter of 2024. The company also reported an improved cash position with $149 million on the balance sheet and total liquidity of $249 million. Their net leverage ratio was significantly reduced to 2.8x adjusted EBITDA from 5.7x in the first quarter of 2024. Emergent's MCM product sales were projected between $435 million and $485 million, while commercial products, including NARCAN, were expected to generate revenues in the range of $265 million to $315 million. The company also highlighted strong international sales, with $91 million in MCM sales outside the United States during the quarter.

Emergent Biosolutions Financial Statement Overview

Summary
Emergent BioSolutions is facing profitability issues with declining revenues and negative net income. While there is some recovery in cash flow, it remains volatile. The balance sheet shows moderate leverage but declining equity, raising concerns about financial stability.
Income Statement
40
Negative
Emergent Biosolutions has experienced a decline in revenue from 2021 to TTM 2025, coupled with negative net income over the past few periods, indicating profitability issues. The gross profit margin for TTM 2025 is approximately 31.6%, showing a decrease compared to historical figures. The company also faces challenges with negative EBIT and EBITDA margins, signaling operational inefficiencies.
Balance Sheet
50
Neutral
The company's debt-to-equity ratio for TTM 2025 stands at approximately 1.20, indicating a moderate level of leverage. While the equity ratio is around 38.8%, showing a reasonable balance between equity and assets, the declining stockholders' equity over the years raises concerns about financial stability. The negative ROE underscores ongoing profitability challenges.
Cash Flow
55
Neutral
Emergent Biosolutions shows a positive trend in operating cash flow for TTM 2025, with an operating cash flow to net income ratio of approximately -0.84, reflecting cash flow generation despite losses. The free cash flow has improved compared to previous years, suggesting some recovery in cash management. However, the significant fluctuations in cash flow metrics highlight potential volatility.
Breakdown
TTMDec 2024Dec 2023Dec 2022Dec 2021Dec 2020
Income StatementTotal Revenue
960.00M1.01B1.05B1.12B1.79B1.56B
Gross Profit
303.40M305.20M343.90M427.20M1.04B1.03B
EBIT
-54.20M-108.70M-726.40M-166.00M352.60M433.80M
EBITDA
106.30M36.90M-505.30M-32.90M458.20M549.00M
Net Income Common Stockholders
-131.60M-190.60M-760.50M-223.80M219.50M305.80M
Balance SheetCash, Cash Equivalents and Short-Term Investments
149.10M99.50M111.70M642.60M576.10M621.30M
Total Assets
1.43B1.39B1.82B3.17B2.96B2.88B
Total Debt
665.70M663.70M860.20M1.41B841.00M874.80M
Net Debt
516.60M564.20M748.50M763.20M264.90M253.50M
Total Liabilities
873.40M906.90M1.17B1.78B1.34B1.44B
Stockholders Equity
552.70M482.80M649.30M1.38B1.62B1.45B
Cash FlowFree Cash Flow
94.40M35.80M-257.90M-149.90M96.10M395.00M
Operating Cash Flow
110.10M58.70M-206.30M-34.10M321.10M536.00M
Investing Cash Flow
195.50M125.20M212.30M-381.30M-225.00M-151.00M
Financing Cash Flow
-231.10M-190.00M-535.70M481.20M-141.00M69.50M

Emergent Biosolutions Technical Analysis

Technical Analysis Sentiment
Negative
Last Price6.24
Price Trends
50DMA
5.63
Positive
100DMA
6.63
Negative
200DMA
7.75
Negative
Market Momentum
MACD
0.18
Positive
RSI
50.36
Neutral
STOCH
39.26
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For EBS, the sentiment is Negative. The current price of 6.24 is below the 20-day moving average (MA) of 6.47, above the 50-day MA of 5.63, and below the 200-day MA of 7.75, indicating a neutral trend. The MACD of 0.18 indicates Positive momentum. The RSI at 50.36 is Neutral, neither overbought nor oversold. The STOCH value of 39.26 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for EBS.

Emergent Biosolutions Risk Analysis

Emergent Biosolutions disclosed 57 risk factors in its most recent earnings report. Emergent Biosolutions reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks

Emergent Biosolutions Peers Comparison

Overall Rating
UnderperformOutperform
Sector (54)
Financial Indicators
Name
Overall Rating
Market Cap
P/E Ratio
ROE
Dividend Yield
Revenue Growth
EPS Growth
80
Outperform
$464.37M9.5725.47%10.13%-23.37%-39.03%
64
Neutral
$1.39B-5.19%30.26%-173.36%
54
Neutral
$5.34B3.27-45.10%3.30%16.80%0.02%
53
Neutral
$351.62M77.48%5.29%-37.31%
EBEBS
52
Neutral
$339.24M-21.63%-18.56%76.88%
48
Neutral
$1.23B64.45-10.45%24.76%-783.38%
46
Neutral
$246.96M-83.58%6.88%-17.54%
* Healthcare Sector Average
Performance Comparison
Ticker
Company Name
Price
Change
% Change
EBS
Emergent Biosolutions
6.24
0.18
2.97%
DVAX
Dynavax
10.17
-1.11
-9.84%
LFCR
Lifecore Biomedical
6.81
1.92
39.26%
SIGA
SIGA Technologies
6.50
0.78
13.64%
ANIP
ANI Pharmaceuticals
64.29
3.55
5.84%
AQST
Aquestive Therapeutics
3.54
0.86
32.09%

Emergent Biosolutions Corporate Events

Legal Proceedings
Emergent Biosolutions Settlement Receives Preliminary Approval
Negative
May 23, 2025

On May 9, 2025, the United States District Court for the District of Maryland granted preliminary approval for a proposed settlement of shareholder derivative actions against Emergent BioSolutions Inc. The settlement, which includes no admission of fault by the defendants, addresses allegations of fiduciary breaches related to the company’s Bayview facility and its role in manufacturing COVID-19 vaccines. The court has scheduled a hearing for August 6, 2025, to determine final approval. The allegations claimed that Emergent’s management failed to ensure regulatory compliance, leading to significant financial losses and legal challenges.

The most recent analyst rating on (EBS) stock is a Buy with a $16.00 price target. To see the full list of analyst forecasts on Emergent Biosolutions stock, see the EBS Stock Forecast page.

Business Operations and StrategyFinancial Disclosures
Emergent BioSolutions Reports 656% Net Income Surge
Positive
May 7, 2025

Emergent BioSolutions reported a significant financial turnaround in the first quarter of 2025, with a net income increase of 656% despite a 26% drop in total revenues compared to the previous year. The company attributes this improvement to its strategic plan aimed at stabilizing operations and enhancing profitability, as evidenced by increased gross and EBITDA margins. Recent business developments include securing contracts with the U.S. Department of Defense and other international orders, as well as strategic partnerships and asset sales, all of which are expected to support future growth and stability.

Executive/Board ChangesShareholder Meetings
Emergent BioSolutions Stockholders Elect Directors at Meeting
Neutral
May 6, 2025

On April 30, 2025, Emergent BioSolutions Inc. held its annual meeting of stockholders, where approximately 67% of the company’s shares were represented. During the meeting, stockholders elected three Class I directors, ratified the appointment of Ernst & Young LLP as the company’s independent auditor for 2025, and approved the 2024 compensation for the company’s named executive officers.

Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

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.