Today I will take a look at Intellia Therapeutics Inc’s (NASDAQ:NTLA) most recent earnings update (31 March 2018) and compare these latest figures against its performance over the past few years, as well as how the rest of the biotechs industry performed. As an investor, I find it beneficial to assess NTLA’s trend over the short-to-medium term in order to gauge whether or not the company is able to meet its goals, and ultimately sustainably grow over time. Check out our latest analysis for Intellia Therapeutics
Was NTLA’s recent earnings decline worse than the long-term trend and the industry?NTLA is loss-making, with the most recent trailing twelve-month earnings of -US$76.27m (from 31 March 2018), which compared to last year has become more negative. However, the company’s loss seem to be contracting over the medium term, with the five-year earnings average of -US$35.06m. Each year, for the past five years NTLA has seen an annual increase in operating expense growth, outpacing revenue growth of 64.45%, on average. This adverse movement is a driver of the company’s inability to reach breakeven. Looking at growth from a sector-level, the US biotechs industry has been growing its average earnings by double-digit 21.75% over the previous year, and 17.77% over the past half a decade. This suggests that any uplift the industry is enjoying, Intellia Therapeutics has not been able to gain as much as its average peer.
Even though Intellia Therapeutics is currently unprofitable, it has an ample cash cushion (US$327.78m) to pay for its upcoming operating expenses over the next couple of years. This is a strong indication of good cash management.
What does this mean?
While past data is useful, it doesn’t tell the whole story. With companies that are currently loss-making, it is always hard to predict what will occur going forward, and when. The most valuable step is to assess company-specific issues Intellia Therapeutics may be facing and whether management guidance has steadily been met in the past. You should continue to research Intellia Therapeutics to get a better picture of the stock by looking at:
- Future Outlook: What are well-informed industry analysts predicting for NTLA’s future growth? Take a look at our free research report of analyst consensus for NTLA’s outlook.
- Financial Health: Is NTLA’s operations financially sustainable? Balance sheets can be hard to analyze, which is why we’ve done it for you. Check out our financial health checks here.
- Other High-Performing Stocks: Are there other stocks that provide better prospects with proven track records? Explore our free list of these great stocks here.