NasdaqGM:ZGNX

Stock Analysis Report

Executive Summary

Zogenix, Inc., a pharmaceutical company, develops and commercializes therapies for the treatment of transformative central nervous system disorders in the United States.

Rewards

Trading at 63.4% below its fair value

Earnings are forecast to grow 61.26% per year

Risk Analysis

Shareholders have been diluted in the past year

Does not have meaningful revenue ($2M)



Snowflake Analysis

Excellent balance sheet with high growth potential.


Similar Companies

Share Price & News

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


Latest Share Price and Events

Stable Share Price: ZGNX has not had significant price volatility in the past 3 months.


Market Performance


7 Day Return

-1.2%

ZGNX

-0.5%

US Pharmaceuticals

-0.09%

US Market


1 Year Return

30.1%

ZGNX

15.2%

US Pharmaceuticals

23.9%

US Market

Return vs Industry: ZGNX exceeded the US Pharmaceuticals industry which returned 12.6% over the past year.

Return vs Market: ZGNX exceeded the US Market which returned 24.7% over the past year.


Shareholder returns

ZGNXIndustryMarket
7 Day-1.2%-0.5%-0.09%
30 Day2.4%2.3%3.1%
90 Day22.2%15.0%10.4%
1 Year30.1%30.1%18.1%15.2%26.6%23.9%
3 Year574.8%574.8%42.8%32.6%50.9%41.2%
5 Year403.0%403.0%30.6%16.8%78.1%58.5%

Price Volatility Vs. Market

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


Simply Wall St News

Valuation

Is Zogenix undervalued compared to its fair value and its price relative to the market?

>50%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: ZGNX ($55.08) is trading below our estimate of fair value ($150.34)

Significantly Below Fair Value: ZGNX is trading below fair value by more than 20%.


Price To Earnings Ratio

PE vs Industry: ZGNX is unprofitable, so we can't compare its PE Ratio to the Pharmaceuticals industry average.

PE vs Market: ZGNX is unprofitable, so we can't compare its PE Ratio to the US market.


Price to Earnings Growth Ratio

PEG Ratio: Insufficient data to calculate ZGNX's PEG Ratio to determine if it is good value.


Price to Book Ratio

PB vs Industry: ZGNX is overvalued based on its PB Ratio (9.7x) compared to the US Pharmaceuticals industry average (3.3x).


Next Steps

Future Growth

How is Zogenix forecast to perform in the next 1 to 3 years based on estimates from 11 analysts?

61.5%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: ZGNX is forecast to become profitable over the next 3 years, which is considered faster growth than the savings rate (1.7%).

Earnings vs Market: ZGNX is forecast to become profitable over the next 3 years, which is considered above average market growth.

High Growth Earnings: ZGNX's is expected to become profitable in the next 3 years.

Revenue vs Market: ZGNX's revenue (53.1% per year) is forecast to grow faster than the US market (7.5% per year).

High Growth Revenue: ZGNX's revenue (53.1% per year) is forecast to grow faster than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: Insufficient data to determine if ZGNX's Return on Equity is forecast to be high in 3 years time


Next Steps

Past Performance

How has Zogenix performed over the past 5 years?

-52.4%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: ZGNX is currently unprofitable.

Growing Profit Margin: ZGNX is currently unprofitable.


Past Earnings Growth Analysis

Earnings Trend: ZGNX is unprofitable, and losses have increased over the past 5 years at a rate of -52.4% per year.

Accelerating Growth: Unable to compare ZGNX's earnings growth over the past year to its 5-year average as it is currently unprofitable

Earnings vs Industry: ZGNX is unprofitable, making it difficult to compare its past year earnings growth to the Pharmaceuticals industry (36.8%).


Return on Equity

High ROE: ZGNX has a negative Return on Equity (-153.99%), as it is currently unprofitable.


Return on Assets


Return on Capital Employed


Next Steps

Financial Health

How is Zogenix's financial position?


Financial Position Analysis

Short Term Liabilities: ZGNX's short term assets ($292.3M) exceed its short term liabilities ($97.4M).

Long Term Liabilities: ZGNX's short term assets ($292.3M) exceed its long term liabilities ($72.3M).


Debt to Equity History and Analysis

Debt Level: ZGNX is debt free.

Reducing Debt: ZGNX has no debt compared to 5 years ago when its debt to equity ratio was 4.5%.


Balance Sheet

Inventory Level: ZGNX has a low level of unsold assets or inventory.

Debt Coverage by Assets: Insufficient data to determine if ZGNX's debt is covered by short term assets.


Cash Runway Analysis

For companies that have on average been loss making in the past we assess whether they have at least 1 year of cash runway.

Stable Cash Runway: ZGNX has sufficient cash runway for more than a year based on its current free cash flow.

Forecast Cash Runway: Insufficient data to determine if ZGNX has enough cash runway if its free cash flow continues to grow or shrink based on historical rates.


Next Steps

Dividend

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


Dividend Yield vs Market

companyn/amarketbottom25%1.4%markettop25%3.7%industryaverage2.6%forecastin3Years0%

Current dividend yield vs market & industry

Notable Dividend: Unable to evaluate ZGNX's dividend yield against the bottom 25% of dividend payers, as the company has not reported any payouts.

High Dividend: Unable to evaluate ZGNX's dividend yield against the top 25% of dividend payers, as the company has not reported any payouts.


Stability and Growth of Payments

Stable Dividend: Insufficient data to determine if ZGNX's dividends per share have been stable in the past.

Growing Dividend: Insufficient data to determine if ZGNX's dividend payments have been increasing.


Current Payout to Shareholders

Dividend Coverage: Insufficient data to calculate payout ratio to determine if its dividend payments are covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: No need to calculate the sustainability of ZGNX's dividend in 3 years as they are not forecast to pay a notable one for the US market.


Next Steps

Management

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

6.1yrs

Average management tenure


CEO

Steve Farr (60yo)

4.8yrs

Tenure

US$6,650,252

Compensation

Dr. Stephen J. Farr, also known as Steve, Ph.D., co-founded Zogenix, Inc. in 2006 and has been its President since May 2006 and its Chief Executive Officer since April 2015. Dr. Farr served as the Chief Op ...


CEO Compensation Analysis

Compensation vs Market: Steve's total compensation ($USD6.65M) is above average for companies of similar size in the US market ($USD4.99M).

Compensation vs Earnings: Steve's compensation has increased whilst the company is unprofitable.


Management Age and Tenure

6.1yrs

Average Tenure

56yo

Average Age

Experienced Management: ZGNX's management team is seasoned and experienced (6.1 years average tenure).


Board Age and Tenure

11.7yrs

Average Tenure

61.5yo

Average Age

Experienced Board: ZGNX's board of directors are seasoned and experienced ( 11.7 years average tenure).


Insider Trading

Insider Buying: Insufficient data to determine if insiders have bought more shares than they have sold in the past 3 months.


Recent Insider Transactions

SellUS$3,179,47615 Mar 19
Roger Hawley
EntityIndividual
Shares60,000
Max PriceUS$53.10

Ownership Breakdown

Dilution of Shares: Shareholders have been diluted in the past year, with total shares outstanding growing by 18.3%.


Management Team

  • Steve Farr (60yo)

    Co-Founder

    • Tenure: 4.8yrs
    • Compensation: US$6.65m
  • Bret Megargel (50yo)

    Vice President of Corporate Development

    • Tenure: 13.4yrs
  • John Turanin (61yo)

    VP & GM of Zogenix Technologies

    • Tenure: 13.7yrs
    • Compensation: US$326.24k
  • Mike Smith (51yo)

    Executive VP

    • Tenure: 3yrs
    • Compensation: US$1.99m
  • Bradley Galer (57yo)

    Executive VP & Chief Medical Officer

    • Tenure: 6.1yrs
    • Compensation: US$2.55m
  • Stephen Jenner (51yo)

    Vice President of Marketing

    • Tenure: 9yrs
  • Gail Farfel (55yo)

    Executive VP & Chief Development Officer

    • Tenure: 4.5yrs
    • Compensation: US$2.36m
  • Jeff Durflinger (58yo)

    Vice President of Technical Operations & Product Supply

    • Tenure: 8.8yrs
  • Catherine O'Connor

    Senior Director of Corporate Communications

    • Ashish Sagrolikar

      Executive VP & Chief Commercial Officer

      • Tenure: 1.5yrs
      • Compensation: US$4.35m

    Board Members

    • Lou Bock (54yo)

      Independent Director

      • Tenure: 13.4yrs
      • Compensation: US$477.90k
    • Cam Garner (71yo)

      Co-founder & Chairman

      • Tenure: 13.4yrs
      • Compensation: US$517.90k
    • Steve Farr (60yo)

      Co-Founder

      • Tenure: 4.8yrs
      • Compensation: US$6.65m
    • Erle Mast (57yo)

      Independent Director

      • Tenure: 11.7yrs
      • Compensation: US$487.90k
    • Jim Breitmeyer (65yo)

      Independent Director

      • Tenure: 5.8yrs
      • Compensation: US$465.40k
    • Mark Wiggins (63yo)

      Independent Director

      • Tenure: 8.7yrs
      • Compensation: US$475.40k
    • David Brushwood

      Member of External Safe Use Board

      • Tenure: 5.5yrs
    • Jeff Gudin

      Chairperson of External Safe Use Board

      • John Burke

        Member of External Safe Use Board

        • Debra Gordon

          Member of External Safe Use Board

          Company Information

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


          Key Information

          • Name: Zogenix, Inc.
          • Ticker: ZGNX
          • Exchange: NasdaqGM
          • Founded: 2006
          • Industry: Pharmaceuticals
          • Sector: Pharmaceuticals & Biotech
          • Market Cap: US$2.404b
          • Shares outstanding: 44.25m
          • Website: https://www.zogenix.com

          Number of Employees


          Location

          • Zogenix, Inc.
          • 5858 Horton Street
          • Suite 455
          • Emeryville
          • California
          • 94608
          • United States

          Listings

          TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
          ZGNXNasdaqGM (Nasdaq Global Market)YesCommon StockUSUSDNov 2010
          Z081DB (Deutsche Boerse AG)YesCommon StockDEEURNov 2010
          0M3OLSE (London Stock Exchange)YesCommon StockGBUSDNov 2010

          Biography

          Zogenix, Inc., a pharmaceutical company, develops and commercializes therapies for the treatment of transformative central nervous system disorders in the United States. Its lead product candidate is the Fintepla/ZX008, a low-dose fenfluramine, which is in Phase III clinical trials for the treatment of seizures associated with Dravet syndrome. The company was formerly known as SJ2 Therapeutics, Inc. and changed its name to Zogenix, Inc. in August 2006. Zogenix, Inc. was founded in 2006 and is headquartered in Emeryville, California. 


          Company Analysis and Financial Data Status

          All financial data provided by Standard & Poor's Capital IQ.
          DataLast Updated (UTC time)
          Company Analysis2020/01/24 00:19
          End of Day Share Price2020/01/23 00:00
          Earnings2019/09/30
          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.