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Enanta Pharmaceuticals (ENTA)
NASDAQ:ENTA

Enanta Pharmaceuticals (ENTA) AI Stock Analysis

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Enanta Pharmaceuticals

(NASDAQ:ENTA)

Rating:49Neutral
Price Target:
$8.00
▲(4.58%Upside)
The overall stock score reflects financial challenges with negative profitability and cash flow issues. While technical indicators suggest recent positive momentum, valuation concerns due to negative earnings remain a significant risk.
Positive Factors
Clinical Trials and Drug Development
Zelicapavir successfully met the study's primary virology endpoint in the pooled efficacy population, with a peak viral load reduction of 0.7 log on Day 9 compared to placebo.
Financial Performance
Enanta received a $33.8M federal income tax refund, strengthening their balance sheet.
Funding and Cash Flow
Enanta ended fiscal 2Q25 with cash and marketable securities of $193.4M, which together with future royalty revenue should fund operations into fiscal 2028.
Negative Factors
Financial Projections
Key model changes which lowered our PT to $8 from $10 due to a potentially longer time horizon required to execute remaining clinical development/regulatory steps for the RSV and COVID-19 programs.
Market Performance
Enanta shares have settled near multi-year lows with a lack of late-stage catalysts and visibility to approvals/market.
Regulatory Challenges
Clarity is needed for symptom improvement with zelicapavir, as there are no regulatory-approved symptom assessment tools for pediatric RSV currently.

Enanta Pharmaceuticals (ENTA) vs. SPDR S&P 500 ETF (SPY)

Enanta Pharmaceuticals Business Overview & Revenue Model

Company DescriptionEnanta Pharmaceuticals, Inc., a biotechnology company, discovers and develops small molecule drugs for the treatment of viral infections and liver diseases. Its research and development disease targets include respiratory syncytial virus, SARS-CoV-2, human metapneumovirus, and hepatitis B virus. The company has a collaborative development and license agreement with Abbott Laboratories to identify, develop, and commercialize HCV NS3 and NS3/4A protease inhibitor compounds, including paritaprevir and glecaprevir for the treatment of chronic hepatitis C virus. Enanta Pharmaceuticals, Inc. was founded in 1995 and is headquartered in Watertown, Massachusetts.
How the Company Makes MoneyEnanta Pharmaceuticals generates revenue primarily through collaborations and partnerships with larger pharmaceutical companies. These partnerships often involve licensing agreements, under which Enanta receives upfront payments, milestone payments, and royalties on net sales of products developed using its proprietary compounds. For instance, Enanta has a collaboration with AbbVie for the development and commercialization of HCV therapies, which has been a significant source of revenue. Additionally, Enanta invests in its own research and development efforts to advance its pipeline of drug candidates, aiming to bring new therapies to market and generate revenue through direct sales in the future.

Enanta Pharmaceuticals Earnings Call Summary

Earnings Call Date:May 12, 2025
(Q2-2024)
|
% Change Since: 37.84%|
Next Earnings Date:Aug 11, 2025
Earnings Call Sentiment Neutral
The earnings call presented a mixed sentiment with significant advancements in the RSV and immunology programs and a stable financial position. However, it also highlighted challenges with a decline in revenue, increased net loss, and slower enrollment in the RSVPEDs study.
Q2-2024 Updates
Positive Updates
RSV Program Advancements
Progress in developing the first oral antiviral treatment for RSV, with two Phase II studies (RSVPEDs and RSVHR) ongoing and anticipation of reporting data in the second half of 2024.
Successful EDP-323 Development
EDP-323 is in a Phase IIa challenge study with anticipated data in Q3 2024, supported by positive Phase I results demonstrating favorable safety and pharmacokinetics.
Pipeline Expansion into Immunology
Introduction of a new immunology program targeting chronic spontaneous urticaria (CSU) with a goal to select a development candidate by Q4 2024.
Stable Financial Position
Enanta ended the quarter with approximately $300 million in cash and marketable securities, projecting sufficient funds to meet anticipated needs through Q3 2027.
Negative Updates
Revenue Decline
Total revenue for the quarter decreased to $17.1 million from $17.8 million in the same period in 2023, primarily due to lower royalty rates.
Increased Net Loss
Net loss for the quarter was $31.2 million compared to $37.7 million in the same period in 2023, driven by increased R&D expenses and interest expenses from a previous royalty sale transaction.
Challenges in RSVPEDs Enrollment
Enrollment in the last age cohort of the RSVPEDs study is slower due to a narrower eligible population, requiring continued recruitment in the Southern Hemisphere.
Company Guidance
During the earnings call for Enanta Pharmaceuticals' fiscal second quarter of 2024, the company provided guidance on several key metrics. For the quarter, total revenue was reported at $17.1 million, primarily from royalty revenue tied to AbbVie's MAVYRET sales. The company updated its expense guidance, projecting research and development expenses to range between $125 million and $145 million, reflecting increased investment in its RSV and new immunology programs. General and administrative expenses are expected to be between $50 million and $60 million, influenced by additional stock compensation and legal costs. Enanta concluded the quarter with approximately $300 million in cash and marketable securities, anticipating this will support its existing operations through the third quarter of fiscal 2027. The company is also advancing its RSV and CSU programs, with milestones including data readouts expected in the second half of 2024 and the introduction of a second immunology program.

Enanta Pharmaceuticals Financial Statement Overview

Summary
Enanta Pharmaceuticals is struggling financially, with declining revenue and negative profitability. Despite a strong gross profit margin, the company faces challenges with negative cash flows and operating inefficiencies.
Income Statement
45
Neutral
Enanta Pharmaceuticals has been experiencing declining revenue with a negative growth rate over recent periods. The company is facing significant challenges in terms of profitability, as evidenced by negative net profit and EBIT margins. However, the gross profit margin is high, indicating that the cost of revenue is well-managed.
Balance Sheet
55
Neutral
The balance sheet shows a moderate debt-to-equity ratio, suggesting balanced leverage. However, the return on equity is negative due to consistent net losses. The equity ratio is relatively stable, indicating that a fair portion of the company's assets are financed by equity.
Cash Flow
50
Neutral
Operating cash flow and free cash flow remain negative, reflecting ongoing operational challenges and capital spending. Despite this, the company's ability to maintain cash reserves is noted, although cash generation from operations is a concern.
BreakdownTTMSep 2024Sep 2023Sep 2022Sep 2021Sep 2020
Income Statement
Total Revenue64.46M67.64M79.20M86.16M97.07M122.47M
Gross Profit64.46M67.64M79.20M86.16M97.07M122.47M
EBITDA-87.12M-104.51M-123.48M-119.22M-104.25M-37.99M
Net Income-96.42M-116.05M-133.82M-121.75M-79.00M-36.17M
Balance Sheet
Total Assets322.99M376.65M462.27M375.41M438.79M486.13M
Cash, Cash Equivalents and Short-Term Investments193.38M248.19M369.91M249.23M244.00M386.65M
Total Debt58.73M55.47M26.51M25.26M5.33M8.10M
Total Liabilities229.46M247.84M245.54M54.08M39.36M30.55M
Stockholders Equity93.54M128.81M216.74M321.33M399.43M455.58M
Cash Flow
Free Cash Flow-82.24M-96.71M-112.21M-86.91M-70.75M5.64M
Operating Cash Flow-55.46M-78.76M-103.15M-84.78M-70.00M7.09M
Investing Cash Flow77.26M58.23M-53.58M54.90M36.99M19.83M
Financing Cash Flow-25.73M-27.63M198.13M20.03M3.08M8.98M

Enanta Pharmaceuticals Technical Analysis

Technical Analysis Sentiment
Positive
Last Price7.65
Price Trends
50DMA
6.50
Positive
100DMA
6.40
Positive
200DMA
7.49
Positive
Market Momentum
MACD
0.35
Positive
RSI
60.48
Neutral
STOCH
68.77
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For ENTA, the sentiment is Positive. The current price of 7.65 is above the 20-day moving average (MA) of 7.49, above the 50-day MA of 6.50, and above the 200-day MA of 7.49, indicating a bullish trend. The MACD of 0.35 indicates Positive momentum. The RSI at 60.48 is Neutral, neither overbought nor oversold. The STOCH value of 68.77 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for ENTA.

Enanta Pharmaceuticals Risk Analysis

Enanta Pharmaceuticals disclosed 50 risk factors in its most recent earnings report. Enanta 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

Enanta 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
52
Neutral
$7.45B0.30-61.93%2.28%16.62%1.04%
49
Neutral
$163.53M-74.26%-11.55%27.32%
49
Neutral
$122.92M19.74376.84%19.03%
SLSLS
43
Neutral
$216.52M-144.90%60.51%
$92.99M-20.53%
42
Neutral
$94.75M-3758.21%-100.00%-7.66%
TITIL
34
Underperform
$155.08M-44.50%52.54%
* Healthcare Sector Average
Performance Comparison
Ticker
Company Name
Price
Change
% Change
ENTA
Enanta Pharmaceuticals
7.65
-6.79
-47.02%
SLS
SELLAS Life Sciences Group
2.17
0.99
83.90%
XBIT
XBiotech
3.05
-2.89
-48.65%
MCRB
Seres Therapeutics
10.85
-9.55
-46.81%
CSBR
Champions Oncology
8.89
3.88
77.45%
TIL
Instil Bio
23.64
13.63
136.16%

Enanta Pharmaceuticals Corporate Events

Executive/Board ChangesShareholder Meetings
Enanta Pharmaceuticals Stockholders Approve Key Proposals in 2025
Neutral
Mar 17, 2025

At the Annual Meeting on March 13, 2025, Enanta Pharmaceuticals’ stockholders voted on several key proposals. They re-elected two Class III directors, approved an amendment to the 2019 Equity Incentive Plan to increase shares by 800,000, decided to hold an annual advisory vote on executive compensation, approved the executive compensation, and ratified PricewaterhouseCoopers LLP as the independent auditor for the 2025 fiscal year.

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.Date of analysis: Jun 12, 2025