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Scholar Rock Holding Corp (SRRK)
NASDAQ:SRRK

Scholar Rock Holding (SRRK) AI Stock Analysis

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Scholar Rock Holding

(NASDAQ:SRRK)

50Neutral
Scholar Rock's overall stock score reflects significant challenges due to financial underperformance, including a lack of revenue and ongoing losses. Despite these issues, positive strides in its SMA program and strategic leadership changes indicate potential for future growth. Mixed technical indicators and a weak valuation further moderate the outlook.
Positive Factors
Clinical Trial Success
Positive topline results from the Ph III SAPPHIRE trial of apitegromab in SMA satisfied key opinion leaders, supporting stock optimism.
Market Potential
Ex-US revenues are likely to represent approximately two-thirds of the peak apitegromab revenue guidance, indicating strong international market potential.
Regulatory Approval
Apitegromab is likely to receive FDA approval for treating spinal muscular atrophy, boosting investor confidence.
Negative Factors
Investor Sentiment
Short interest stands at 23.7% of the float, indicating potential skepticism among investors.
Market Competition
Despite apitegromab's potential, there is anticipation for proof of concept GLP-1+apitegromab data, suggesting competition in related therapeutic areas.

Scholar Rock Holding (SRRK) vs. S&P 500 (SPY)

Scholar Rock Holding Business Overview & Revenue Model

Company DescriptionScholar Rock Holding Corporation, a biopharmaceutical company, focuses on the discovery and development of medicines for the treatment of serious diseases in which signaling by protein growth factors plays a fundamental role. The company develops Apitegromab, an inhibitor of the activation of latent myostatin that has completed the Phase 3 clinical trials for the treatment of spinal muscular atrophy; and SRK-181, which is in Phase 1 clinical trials for the treatment of cancers that are resistant to checkpoint inhibitor therapies, such as anti-PD-1 or anti-PD-L1 antibody therapies. It is also developing a pipeline of novel product candidates with potential to transform the lives of patients suffering from a range of serious diseases, including neuromuscular disorders, cancer, and fibrosis. The company has a collaboration agreement with Gilead Sciences, Inc. to discover and develop specific inhibitors of transforming growth factor beta activation for the treatment of fibrotic diseases. Scholar Rock Holding Corporation was founded in 2012 and is headquartered in Cambridge, Massachusetts.
How the Company Makes MoneyScholar Rock makes money primarily through the development and commercialization of its proprietary drug candidates. The company's revenue model includes partnerships and collaborations with larger pharmaceutical companies, which provide upfront payments, milestone payments, and royalties on future sales of successfully developed drugs. Additionally, Scholar Rock may generate income through licensing agreements, where it grants other companies the rights to develop and market its therapeutic candidates. The company's financial performance is heavily influenced by the progress of its clinical trials, regulatory approvals, and the successful commercialization of its products.

Scholar Rock Holding Financial Statement Overview

Summary
Scholar Rock Holding is facing significant challenges with no revenue generation and ongoing net losses, impacting its income statement. The balance sheet is stable with strong liquidity and low leverage, but continued losses could affect equity. Cash flows are negative, indicating reliance on external financing. Overall, the financial outlook is concerning, with critical focus needed on revenue generation and cost management.
Income Statement
25
Negative
Scholar Rock Holding has shown no revenue for 2023 and 2024, indicating an absence of sales or other income-generating activities. The company is operating at a loss, with a significantly negative net income. Gross profit is also at zero, and the company has declining EBIT and EBITDA margins due to increasing expenses relative to revenues. The lack of revenue growth is concerning for future profitability.
Balance Sheet
45
Neutral
Scholar Rock Holding maintains a moderate equity base relative to its total assets, with an equity ratio around 77.6% in 2024. The debt-to-equity ratio is low at 0.18, suggesting conservative leverage. However, the company is incurring losses, which could impact future equity levels. Positive cash and cash equivalents indicate good liquidity.
Cash Flow
40
Negative
The company experiences negative operating cash flow, which raises concerns about its ability to sustain operations without external financing. Free cash flow is also negative, indicating that the company is not generating cash from its core operations. However, financing activities have provided substantial cash inflows, helping to mitigate cash flow deficiencies.
Breakdown
Dec 2024Dec 2023Dec 2022Dec 2021Dec 2020
Income StatementTotal Revenue
0.000.0033.19M18.82M15.40M
Gross Profit
0.00-2.84M23.31M9.79M-58.66M
EBIT
-252.05M-171.29M-134.37M-129.92M-86.88M
EBITDA
-252.05M-168.45M-131.38M-127.29M-85.39M
Net Income Common Stockholders
-246.29M-165.79M-131.65M-131.80M-84.99M
Balance SheetCash, Cash Equivalents and Short-Term Investments
437.28M279.94M315.36M252.99M341.03M
Total Assets
474.92M311.04M358.17M304.44M388.31M
Total Debt
65.13M61.82M69.40M77.06M57.14M
Net Debt
-112.75M-40.04M-33.88M-135.78M-103.22M
Total Liabilities
106.29M85.82M97.93M132.37M127.53M
Stockholders Equity
368.63M225.22M260.24M172.07M260.77M
Cash FlowFree Cash Flow
-201.05M-145.30M-133.76M-132.04M-64.36M
Operating Cash Flow
-200.95M-145.23M-132.69M-126.79M-60.27M
Investing Cash Flow
-76.06M41.14M-171.70M134.31M-63.50M
Financing Cash Flow
353.03M102.57M194.83M44.95M247.82M

Scholar Rock Holding Technical Analysis

Technical Analysis Sentiment
Negative
Last Price30.54
Price Trends
50DMA
31.87
Negative
100DMA
36.46
Negative
200DMA
28.67
Positive
Market Momentum
MACD
-0.15
Positive
RSI
46.80
Neutral
STOCH
57.39
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For SRRK, the sentiment is Negative. The current price of 30.54 is below the 20-day moving average (MA) of 31.62, below the 50-day MA of 31.87, and above the 200-day MA of 28.67, indicating a neutral trend. The MACD of -0.15 indicates Positive momentum. The RSI at 46.80 is Neutral, neither overbought nor oversold. The STOCH value of 57.39 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for SRRK.

Scholar Rock Holding Risk Analysis

Scholar Rock Holding disclosed 70 risk factors in its most recent earnings report. Scholar Rock Holding 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

Scholar Rock Holding Peers Comparison

Overall Rating
UnderperformOutperform
Sector (52)
Financial Indicators
Name
Overall Rating
Market Cap
P/E Ratio
ROE
Dividend Yield
Revenue Growth
EPS Growth
82
Outperform
$2.88B12.4937.24%22.42%
53
Neutral
$3.18B-14.40%-23.84%
52
Neutral
$5.14B3.39-43.55%2.83%16.49%-0.19%
50
Neutral
$2.98B-106.71%-22.34%
50
Neutral
$2.17B-103.82%48.04%48.16%
46
Neutral
$3.12B-30.84%-1.20%
45
Neutral
$2.38B-74.17%-43.10%
* Healthcare Sector Average
Performance Comparison
Ticker
Company Name
Price
Change
% Change
SRRK
Scholar Rock Holding
30.54
16.50
117.52%
ACAD
ACADIA Pharmaceuticals
17.16
2.04
13.49%
VKTX
Viking Therapeutics
26.57
-51.44
-65.94%
APLS
Apellis Pharmaceuticals
16.70
-25.22
-60.16%
CRNX
Crinetics Pharmaceuticals
31.29
-19.20
-38.03%
IMVT
Immunovant
13.78
-17.15
-55.45%

Scholar Rock Holding Earnings Call Summary

Earnings Call Date:May 14, 2025
(Q1-2025)
|
% Change Since: -2.74%|
Next Earnings Date:Aug 06, 2025
Earnings Call Sentiment Positive
The earnings call presented a strong positive outlook with significant progress in the development and launch of apitegromab for SMA. Financial stability and a clear strategic direction for global market entry are key strengths. However, there are risks related to regulatory processes, market competition, and exploratory studies that could impact future outcomes.
Q1-2025 Updates
Positive Updates
Positive Phase 3 SAPPHIRE Trial Results
The SAPPHIRE trial showed statistically significant and clinically meaningful improvement in motor function for SMA patients using apitegromab, with a threefold higher chance of improvement versus placebo.
FDA Priority Review and Upcoming Launch
The FDA granted priority review for apitegromab with a PDUFA date set for September 22nd, indicating significant potential impact for SMA treatment.
Global Launch Strategy for Apitegromab
Efforts are underway for a global launch of apitegromab, beginning with the US in Q3 2025, followed by Europe, Asia Pacific, and Latin America.
Strong Financial Position
Scholar Rock ended the quarter with $364.4 million and an additional $100 million available through a debt facility, ensuring financial runway into 2027.
Exploration of New Indications
Scholar Rock is evaluating the use of apitegromab in other neuromuscular disorders and advancing SRK-439 for clinical trials, with an IND filing expected in Q3.
Negative Updates
Potential Challenges with FDA Processes
While interactions with the FDA have been constructive, broader concerns about the agency's state could pose risks, although rare disease focus remains a priority.
Market Competition and Launch Dynamics
Despite the strong position of apitegromab, existing SMA treatments and the complexity of market dynamics could impact initial launch uptake.
Regulatory and Access Risks in Europe
Reimbursement discussions in Europe are pending, with a staggered launch approach starting with Germany in 2026.
Exploratory Nature of EMBRAZE Study
The EMBRAZE study is an initial effort in the cardiometabolic space with results expected in June, leaving future steps contingent on forthcoming data.
Company Guidance
In the first quarter of 2025, Scholar Rock made significant strides in advancing apitegromab for patients with Spinal Muscular Atrophy (SMA). The company highlighted the positive results from the Phase 3 SAPPHIRE trial, which demonstrated a statistically significant and clinically meaningful improvement in motor function measured by the Hammersmith scale. The Biologics License Application (BLA) for apitegromab was granted priority review by the FDA, with a PDUFA date set for September 22, 2025. Scholar Rock is preparing for its US commercial launch, targeting approximately 10,000 SMA patients in the US, with a global reach of about 35,000 who have received SMN-targeted therapies. The company is also exploring additional indications for apitegromab, including other neuromuscular disorders, while advancing its cardiometabolic EMBRAZE study to address muscle mass loss in obesity, with results expected in June. Scholar Rock ended the quarter with $364.4 million in cash and is focused on disciplined capital allocation to support its growth and strategic initiatives into 2027.

Scholar Rock Holding Corporate Events

Executive/Board ChangesBusiness Operations and Strategy
Scholar Rock Appoints David Hallal as New CEO
Positive
Apr 28, 2025

Scholar Rock announced a significant management transition effective April 27, 2025, with David Hallal appointed as the new Chief Executive Officer, succeeding Dr. Jay Backstrom, who will become a Senior Advisor until October 31, 2025. This transition is part of a strategic move to prepare for the global launch of apitegromab, a promising treatment for spinal muscular atrophy (SMA), and includes the addition of three key executives: Akshay Vaishnaw as President of R&D, R. Keith Woods as Chief Operating Officer, and Vikas Sinha as Chief Financial Officer. These changes are expected to bolster Scholar Rock’s evolution into a fully integrated global commercial enterprise, enhancing its positioning in the biopharmaceutical industry and potentially benefiting stakeholders by accelerating the company’s growth and innovation efforts.

Spark’s Take on SRRK Stock

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

Scholar Rock Holding’s stock score is hindered by the lack of revenue and ongoing losses, despite a stable balance sheet and liquidity. While technical indicators provide mixed signals, the company’s strategic progress in its SMA program and forthcoming drug launch offer a positive outlook. However, valuation concerns remain due to significant net losses and no dividend yield. The overall score reflects these challenges, balanced by the potential long-term growth from its pipeline.

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

Executive/Board ChangesShareholder Meetings
Scholar Rock Holding Appoints Interim Financial Officer
Neutral
Mar 21, 2025

Scholar Rock Holding Corporation announced the appointment of Erin Moore as interim Principal Financial Officer and interim Principal Accounting Officer, effective March 21, 2025, following the departure of Edward Myles. Moore, who has been with the company since 2018 and holds extensive financial and accounting credentials, will temporarily oversee financial operations. Additionally, the company scheduled its 2025 Annual Meeting of Stockholders for May 22, 2025, with March 26, 2025, set as the record date for stockholders entitled to vote. The deadline for stockholder proposals is March 31, 2025, adhering to the Securities Exchange Act regulations.

Product-Related AnnouncementsBusiness Operations and StrategyFinancial Disclosures
Scholar Rock Advances SMA Program with Apitegromab Submission
Positive
Feb 27, 2025

Scholar Rock reported its financial results for 2024, highlighting significant progress in its SMA program with the submission of a Biologics License Application for apitegromab, anticipated to launch in the U.S. in late 2025. The company also plans to expand its research into other neuromuscular disorders and cardiometabolic indications, supported by a strong financial position and recent public offering.

Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.

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.