Is uniQure (NASDAQ:QURE) A Risky Investment?

Some say volatility, rather than debt, is the best way to think about risk as an investor, but Warren Buffett famously said that 'Volatility is far from synonymous with risk.' It's only natural to consider a company's balance sheet when you examine how risky it is, since debt is often involved when a business collapses. As with many other companies uniQure N.V. (NASDAQ:QURE) makes use of debt. But the real question is whether this debt is making the company risky.

We've discovered 3 warning signs about uniQure. View them for free.

When Is Debt A Problem?

Generally speaking, debt only becomes a real problem when a company can't easily pay it off, either by raising capital or with its own cash flow. If things get really bad, the lenders can take control of the business. While that is not too common, we often do see indebted companies permanently diluting shareholders because lenders force them to raise capital at a distressed price. Of course, the upside of debt is that it often represents cheap capital, especially when it replaces dilution in a company with the ability to reinvest at high rates of return. The first thing to do when considering how much debt a business uses is to look at its cash and debt together.

What Is uniQure's Net Debt?

As you can see below, uniQure had US$498.3m of debt, at March 2025, which is about the same as the year before. You can click the chart for greater detail. However, it does have US$409.0m in cash offsetting this, leading to net debt of about US$89.2m.

How Strong Is uniQure's Balance Sheet?

According to the last reported balance sheet, uniQure had liabilities of US$36.3m due within 12 months, and liabilities of US$535.4m due beyond 12 months. Offsetting these obligations, it had cash of US$409.0m as well as receivables valued at US$2.52m due within 12 months. So it has liabilities totalling US$160.2m more than its cash and near-term receivables, combined.

uniQure has a market capitalization of US$670.4m, so it could very likely raise cash to ameliorate its balance sheet, if the need arose. But we definitely want to keep our eyes open to indications that its debt is bringing too much risk. When analysing debt levels, the balance sheet is the obvious place to start. But ultimately the future profitability of the business will decide if uniQure can strengthen its balance sheet over time. So if you're focused on the future you can check out this free report showing analyst profit forecasts.

Check out our latest analysis for uniQure

Over 12 months, uniQure reported revenue of US$20m, which is a gain of 6.3%, although it did not report any earnings before interest and tax. That rate of growth is a bit slow for our taste, but it takes all types to make a world.

Caveat Emptor

Importantly, uniQure had an earnings before interest and tax (EBIT) loss over the last year. Indeed, it lost a very considerable US$167m at the EBIT level. Considering that alongside the liabilities mentioned above does not give us much confidence that company should be using so much debt. So we think its balance sheet is a little strained, though not beyond repair. However, it doesn't help that it burned through US$186m of cash over the last year. So suffice it to say we consider the stock very risky. The balance sheet is clearly the area to focus on when you are analysing debt. However, not all investment risk resides within the balance sheet - far from it. To that end, you should learn about the 3 warning signs we've spotted with uniQure (including 1 which can't be ignored) .

If you're interested in investing in businesses that can grow profits without the burden of debt, then check out this free list of growing businesses that have net cash on the balance sheet.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.