NasdaqGS:ARNA

Stock Analysis Report

Executive Summary

Arena Pharmaceuticals, Inc., a biopharmaceutical company, focuses on providing novel medicines with pharmacology and pharmacokinetics to patients worldwide.

Snowflake

Fundamentals

Flawless balance sheet and undervalued.

Risks

  • Arena Pharmaceuticals has significant price volatility in the past 3 months.

Similar Companies

Share Price & News

How has Arena Pharmaceuticals's share price performed over time and what events caused price changes?


Latest Share Price and Events


Market Performance


7 Day Return

-0.4%

NasdaqGS:ARNA

-1.0%

US Biotechs

-1.2%

US Market


1 Year Return

41.2%

NasdaqGS:ARNA

-11.9%

US Biotechs

3.3%

US Market

ARNA outperformed the Biotechs industry which returned -12.1% over the past year.

ARNA outperformed the Market in United States of America which returned 3.4% over the past year.


Share holder returns

ARNAIndustryMarket
7 Day-0.4%-1.0%-1.2%
30 Day7.9%-3.6%0.8%
90 Day35.5%-0.7%0.9%
1 Year41.2%41.2%-11.1%-11.9%5.6%3.3%
3 Year272.4%272.4%9.3%5.4%45.4%35.9%
5 Year34.1%34.1%12.5%7.4%59.4%41.7%

Price Volatility Vs. Market

How volatile is Arena Pharmaceuticals's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is Arena Pharmaceuticals undervalued based on future cash flows and its price relative to the stock market?

>50%

Discount to future cash flow value


Intrinsic Value Based on Future Cash Flows

Arena Pharmaceuticals's share price is below the future cash flow value, and at a moderate discount (> 20%).

Arena Pharmaceuticals's share price is below the future cash flow value, and at a substantial discount (> 40%).


Price Based on Earnings

Arena Pharmaceuticals is good value based on earnings compared to the US Biotechs industry average.

Arena Pharmaceuticals is good value based on earnings compared to the United States of America market.


Price Based on Expected Growth

Arena Pharmaceuticals earnings are not expected to grow next year, we can't assess if its growth is good value.


Price Based on Value of Assets

Arena Pharmaceuticals is good value based on assets compared to the US Biotechs industry average.


Next Steps

Future Growth

How is Arena Pharmaceuticals expected to perform in the next 1 to 3 years based on estimates from 9 analysts?

-45.5%

Forecasted annual earnings growth


Earnings and Revenue Growth Estimates


Future Annual Growth Analysis

Arena Pharmaceuticals's revenue is expected to decrease over the next 1-3 years, this is not considered high growth.

Arena Pharmaceuticals's earnings are expected to decrease over the next 1-3 years, this is not considered high growth.

Arena Pharmaceuticals's revenues are expected to decrease over the next 1-3 years, this is below the United States of America market average.

Arena Pharmaceuticals's earnings are expected to decrease over the next 1-3 years, this is below the United States of America market average.

Arena Pharmaceuticals's earnings are expected to decrease over the next 1-3 years, this is below the low risk savings rate of 2.7%.


Earnings per Share Growth Estimates


Future Return on Equity

Unable to establish if Arena Pharmaceuticals will efficiently use shareholders’ funds in the future (Return on Equity greater than 20%) as it is not expected to be profitable.


Next Steps

Past Performance

How has Arena Pharmaceuticals performed over the past 5 years?

35.5%

Historical annual earnings growth


Earnings and Revenue History


Past Earnings Growth Analysis

Arena Pharmaceuticals has delivered over 20% year on year earnings growth in the past 5 years.

Arena Pharmaceuticals has become profitable in the last year making the earnings growth rate difficult to compare to the 5-year average.

Arena Pharmaceuticals has become profitable in the last year making it difficult to compare the US Biotechs industry average.


Return on Equity

Arena Pharmaceuticals made outstanding use of shareholders’ funds last year (Return on Equity greater than 40%).


Return on Assets

Arena Pharmaceuticals used its assets more efficiently than the US Biotechs industry average last year based on Return on Assets.


Return on Capital Employed

Arena Pharmaceuticals has become profitable over the past 3 years. This is considered to be a significant improvement in its use of capital (Return on Capital Employed).


Next Steps

Financial Health

How is Arena Pharmaceuticals's financial position?


Financial Position Analysis

Arena Pharmaceuticals is able to meet its short term (1 year) commitments with its holdings of cash and other short term assets.

Arena Pharmaceuticals's cash and other short term assets cover its long term commitments.


Debt to Equity History and Analysis

Arena Pharmaceuticals's level of debt (4.2%) compared to net worth is satisfactory (less than 40%).

The level of debt compared to net worth has been reduced over the past 5 years (57.5% vs 4.2% today).

Debt is well covered by operating cash flow (1222.8%, greater than 20% of total debt).

Arena Pharmaceuticals earns more interest than it pays, coverage of interest payments is not a concern.


Balance Sheet

Low level of unsold assets.

Debt is covered by short term assets, assets are 21.7x debt.


Next Steps

Dividend

What is Arena Pharmaceuticals's current dividend yield, its reliability and sustainability?


Dividend Yield and Payments Analysis

Unable to evaluate Arena Pharmaceuticals's dividend yield against the bottom 25% of dividend payers as the company has not reported any payouts.

Unable to evaluate Arena Pharmaceuticals's dividend against the top 25% market benchmark as the company has not reported any payouts.

Unable to perform a dividend volatility check as Arena Pharmaceuticals has not reported any payouts.

Unable to verify if Arena Pharmaceuticals's dividend has been increasing as the company has not reported any payouts.


Current Payout to Shareholders

Unable to calculate sustainability of dividends as Arena Pharmaceuticals has not reported any payouts.


Future Payout to Shareholders

No need to calculate the sustainability of Arena Pharmaceuticals's dividends in 3 years as they are not expected to pay a notable one for United States of America.


Next Steps

Management

What is the CEO of Arena Pharmaceuticals's salary, the management and board of directors tenure and is there insider trading?

2.0yrs

Average management tenure


CEO

Amit Munshi (51yo)

3.2yrs

Tenure

US$6,863,445

Compensation

Mr. Amit D. Munshi has been the Chief Executive Officer and President of Arena Pharmaceuticals, Inc. since May 11, 2016. Mr. Munshi serves as Non-Executive Chairman of Enterprise Therapeutics Ltd since Mar ...


CEO Compensation Analysis

Amit's remuneration is higher than average for companies of similar size in United States of America.

Amit's compensation has increased in line with Arena Pharmaceuticals recently becoming profitable.


Management Age and Tenure

2.0yrs

Average Tenure

51yo

Average Age

The tenure for the Arena Pharmaceuticals management team is about average.


Board Age and Tenure

2.4yrs

Average Tenure

55yo

Average Age

The average tenure for the Arena Pharmaceuticals board of directors is less than 3 years, this suggests a new board.


Insider Trading

No 3 month individual insider trading information.


Recent Insider Transactions

SellUS$7,06308 Mar 19
Tina Nova Bennett
EntityIndividual
Role
Chairman of the Board
Shares1,200
Max PriceUS$45.99
SellUS$9,00005 Feb 19
Steven Spector
EntityIndividual
Role
Executive VP
Shares1,500
Max PriceUS$46.10
SellUS$512,16609 Jan 19
Preston Klassen
EntityIndividual
Role
Executive VP of Research & Development and Chief Medical Officer
Shares19,000
Max PriceUS$44.00
SellUS$519,51417 Aug 18
Steven Spector
EntityIndividual
Role
Executive VP
Shares29,005
Max PriceUS$36.69

Ownership Breakdown


Management Team

  • Robert Lisicki

    Executive VP & Chief Commercial Officer

    • Tenure: 0.7yrs
  • Kevin Lind (43yo)

    Executive VP & CFO

    • Tenure: 3.1yrs
    • Compensation: $3.06m
  • Chris Cabell

    Senior VP & Head of Clinical Development

    • Tenure: 1.8yrs
  • Amit Munshi (51yo)

    President

    • Tenure: 3.2yrs
    • Compensation: $6.86m
  • Steven Spector (54yo)

    Executive VP

    • Tenure: 17.8yrs
    • Compensation: $3.11m
  • Vince Aurentz (51yo)

    Executive VP & Chief Business Officer

    • Tenure: 2.9yrs
    • Compensation: $3.16m
  • Doug Bakan

    Executive Vice President of Technical Operations

    • Tenure: 1.2yrs
  • Paul Audhya

    Senior Vice President of Medical Affairs

    • Tenure: 0.7yrs
  • Suzy Zoumaras (55yo)

    Executive VP & Chief Human Resources Officer

    • Tenure: 0.9yrs
  • Preston Klassen (50yo)

    Executive VP of Research & Development and Chief Medical Officer

    • Tenure: 2.3yrs
    • Compensation: $3.08m

Board Members

  • Kieran Gallahue (56yo)

    Independent Director

    • Tenure: 1.0yrs
    • Compensation: $412.63k
  • Randy Woods (67yo)

    Independent Director

    • Tenure: 11.6yrs
    • Compensation: $351.61k
  • Tina Nova Bennett (65yo)

    Chair of the Board

    • Tenure: 3.1yrs
    • Compensation: $361.36k
  • Jayson Donald Dallas (51yo)

    Independent Director

    • Tenure: 2.4yrs
    • Compensation: $345.57k
  • Garry Neil (65yo)

    Independent Director

    • Tenure: 2.4yrs
    • Compensation: $335.33k
  • Amit Munshi (51yo)

    President

    • Tenure: 3.1yrs
    • Compensation: $6.86m
  • Jen Jarrett (48yo)

    Director

    • Tenure: 2.1yrs
    • Compensation: $345.82k
  • Manmeet Soni (41yo)

    Independent Director

    • Tenure: 0.6yrs
    • Compensation: $262.30k
  • Oliver Fetzer (55yo)

    Independent Director

    • Tenure: 2.4yrs
    • Compensation: $340.57k

Company Information

Arena Pharmaceuticals, Inc.'s company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Arena Pharmaceuticals, Inc.
  • Ticker: ARNA
  • Exchange: NasdaqGS
  • Founded: 1997
  • Industry: biotechnology
  • Sector: pharmaceuticals & biotech
  • Market Cap: US$3.064b
  • Shares outstanding: 49.57m
  • Website: Click here

Number of Employees


Location

  • Arena Pharmaceuticals, Inc.
  • 6154 Nancy Ridge Drive
  • San Diego
  • California
  • 92121
  • United States

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
ARNANasdaqGS (Nasdaq Global Select)YesCommon StockUSUSDJul 2000
RN3NDB (Deutsche Boerse AG)YesCommon StockDEEURJul 2000
0S54LSE (London Stock Exchange)YesCommon StockGBUSDJul 2000
ARNA *BMV (Bolsa Mexicana de Valores)YesCommon StockMXMXNJul 2000

Biography

Arena Pharmaceuticals, Inc., a biopharmaceutical company, focuses on providing novel medicines with pharmacology and pharmacokinetics to patients worldwide. Its investigational clinical programs include ra ...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2019/07/22 01:46
End of Day Share Price2019/07/19 00:00
Earnings2019/03/31
Annual Earnings2018/12/31


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.