Relay Therapeutics (RLAY) AI Stock Analysis

• Market Cap: $498.90M
• Dividend Yield: N/A
• Average Volume (3M): 2.36M
• Price to Earnings (P/E): ―
• Beta (1Y): 2.36
• Revenue Growth: -78.26%
• EPS Growth: 15.41%
• Country: US
• Employees: 259
• Sector: Healthcare
• Sector Strength: 42
• Industry: Biotechnology
• EPS (TTM): -0.46
• Shares Outstanding: 171,444,960
• 10 Day Avg. Volume: 1,656,789
• 30 Day Avg. Volume: 2,363,704
• PEG Ratio: -0.22
• Price to Book (P/B): 0.69
• Price to Sales (P/S): 0.00
• P/FCF Ratio: -1.84
• 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: $14.00
• Price Target Upside: 381.10% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 12

• Rating: 46 Neutral
• Price Target: $3.00 ▲( 3.09% Upside)

Relay Therapeutics' stock score is significantly impacted by its financial challenges, including ongoing losses and negative cash flow. Despite a stable balance sheet, the lack of profitability and cash generation are major concerns. The technical analysis indicates a bearish trend, and the valuation metrics further highlight the company's struggles. Overall, the stock is currently underperforming, warranting caution for investors.

Positive Factors

Financial stability

The reduction in workforce is expected to extend the cash runway into 2029, improving financial stability.

Strategic operations

Strategic cost reductions make sense and are viewed as a positive for the stock.

Negative Factors

Competitive challenge

The competitive landscape in the biotechnology sector poses a challenge for Relay Therapeutics' market position.

Lack of clinical catalysts

Shares are capped by the lack of near-term catalysts, as this is an execution year for the company.

Relay Therapeutics Business Overview & Revenue Model

Company Description

Relay Therapeutics, Inc. operates as a clinical-stage precision medicines company. It engages in transforming the drug discovery process with an initial focus on enhancing small molecule therapeutic discovery in targeted oncology and genetic disease indications. The company's lead product candidates include RLY-4008, an oral small molecule inhibitor of fibroblast growth factor receptor 2 (FGFR2), which is in a first-in-human clinical trial for patients with advanced or metastatic FGFR2-altered solid tumors; RLY-2608, a lead mutant-PI3Ka inhibitor program that targets phosphoinostide 3 kinase alpha; and RLY-1971, an oral small molecule inhibitor of protein tyrosine phosphatase Src homology region 2 domain-containing phosphatase-2 that is in Phase 1 trial in patients with advanced solid tumors. It has collaboration and license agreements with D. E. Shaw Research, LLC to research certain biological targets through the use of D. E. Shaw Research computational modeling capabilities focused on analysis of protein motion to develop and commercialize compounds and products directed to such targets; and Genentech, Inc. for the development and commercialization of RLY-1971. The company was formerly known as Allostery, Inc. and changed its name to Relay Therapeutics, Inc. in December 2015. Relay Therapeutics, Inc. was incorporated in 2015 and is headquartered in Cambridge, Massachusetts.

How the Company Makes Money

Relay Therapeutics generates revenue primarily through collaboration and licensing agreements with other pharmaceutical and biotechnology companies. These partnerships often involve upfront payments, milestone payments, and royalties based on the successful development and commercialization of drugs. Additionally, the company invests in developing its proprietary drug candidates, which could lead to future revenues upon regulatory approval and market launch. Strategic partnerships and licensing deals are pivotal to Relay Therapeutics’ revenue model, allowing them to capitalize on their innovative drug discovery platform.

Relay Therapeutics Financial Statement Overview

Summary

Relay Therapeutics faces ongoing challenges in achieving profitability and positive cash flow. While the balance sheet remains stable with low leverage, the income statement reveals significant losses and operational challenges. The cash flow statement highlights the difficulty in generating sustainable cash flows. Overall, while there are strengths in equity financing and asset management, profitability and cash generation remain critical concerns.

Income Statement

Relay Therapeutics has experienced volatility in revenue, with significant fluctuations over the years. The gross profit margin is positive in recent years, but the company consistently reports negative net income, resulting in a negative net profit margin. EBIT and EBITDA margins are also negative, indicating operational challenges. The revenue has shown growth over the past year, but the overall trajectory remains uncertain.

Balance Sheet

The balance sheet of Relay Therapeutics is relatively strong with a high equity ratio, indicating a larger proportion of assets financed by equity. The company has a low debt-to-equity ratio, suggesting manageable leverage. However, the consistent net losses impact the return on equity negatively. Overall, the company maintains a stable financial position despite ongoing losses.

Cash Flow

Relay Therapeutics has faced challenges generating positive cash flow, with negative free and operating cash flows. The free cash flow has been declining, indicating cash constraints. The operating cash flow to net income ratio is negative, reflecting inefficiencies in converting profits to cash. While the company has been able to access financing, it remains cash flow negative.

Breakdown
TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement		Total Revenue
7.68M	10.01M	25.55M	1.38M	3.03M	82.65M
	Gross Profit
-933.00K	4.54M	20.28M	-2.75M	-896.00K	79.11M
	EBIT
-378.35M	-372.47M	-373.00M	-299.27M	-364.70M	-55.80M
	EBITDA
-372.12M	-372.47M	-374.15M	-306.82M	-222.18M	-52.25M
	Net Income Common Stockholders
-333.39M	-337.71M	-341.97M	-254.26M	-496.81M	-49.01M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
749.61M	781.32M	750.09M	998.92M	958.07M	678.06M
	Total Assets
841.44M	871.30M	843.98M	1.10B	1.01B	799.83M
	Total Debt
52.31M	48.50M	53.47M	57.74M	22.90M	24.42M
	Net Debt
-100.56M	-75.78M	-90.27M	-941.17M	-935.17M	-423.22M
	Total Liabilities
95.68M	93.50M	91.98M	149.55M	110.64M	36.54M
	Stockholders Equity
745.76M	777.79M	752.00M	950.22M	897.81M	763.29M
Cash Flow		Free Cash Flow
-272.62M	-251.13M	-304.44M	-238.55M	-77.88M	-104.42M
	Operating Cash Flow
-271.99M	-249.11M	-300.32M	-229.49M	-74.41M	-102.49M
	Investing Cash Flow
-9.15M	-41.08M	257.63M	-188.75M	-479.51M	81.67M
	Financing Cash Flow
221.23M	270.15M	34.75M	289.91M	388.09M	426.51M

Relay Therapeutics Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 2.91
• 50DMA: Positive
• 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 RLAY, the sentiment is Negative. The current price of 2.91 is below the 20-day moving average (MA) of 3.03, above the 50-day MA of 2.88, and below the 200-day MA of 4.81, indicating a neutral trend. The MACD of -0.02 indicates Positive momentum. The RSI at 48.73 is Neutral, neither overbought nor oversold. The STOCH value of 36.00 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for RLAY.

Relay Therapeutics Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
KROS	53 Neutral	$591.77M	―	0.71%	―	91657.69%	97.21%
Sector *	53 Neutral	$5.14B	3.03	-43.89%	2.83%	16.75%	-0.06%
TBPH	48 Neutral	$465.01M	―	-31.46%	―	6.11%	-37.79%
RLAY	46 Neutral	$498.90M	―	-45.46%	―	-78.26%	15.41%
TYRA	41 Neutral	$494.02M	―	-27.04%	―	―	6.72%
PGEN	38 Underperform	$404.40M	―	-278.55%	―	-22.76%	-46.69%
SION		$561.26M	―		―	―	―

Relay Therapeutics Corporate Events

Relay Therapeutics Highlights Progress at Healthcare Conference

Relay Therapeutics announced participation in the 43rd Annual J.P. Morgan Healthcare Conference, highlighting progress in their clinical programs, notably the RLY-2608, aimed at breast cancer. The company anticipates starting pivotal trials and clinical data updates in 2025, supported by a strong financial position and extensive global clinical experience, targeting significant market opportunities in the oncology sector.