A Look at Biohaven’s Valuation Following $175 Million Share Offering and Recent FDA Setback

Biohaven (NYSE:BHVN) just completed a $175 million follow-on public offering, issuing new shares at $7.50, which is lower than its prior trading price. This move is aimed at bolstering the company’s balance sheet after recent challenges.

See our latest analysis for Biohaven.

Biohaven’s recent stock performance has been dominated by sharp moves, most notably a roughly 48% drop in the last three months after the FDA declined to approve its experimental drug. This led to a follow-on stock offering at a sizable discount. The 1-year total shareholder return now stands at -81%, reflecting both operational setbacks and ongoing market uncertainty. However, the latest $175 million cash infusion signals the company is working to regain its footing for the long term.

If you’re tracking how biotech pivots can shape near-term returns, it’s also a perfect moment to discover See the full list for free.

With Biohaven’s shares battered and new funding in hand, the crucial question for investors is whether the current price reflects just the recent setbacks or also factors in all future risks and recovery potential. This leaves room for a true buying opportunity, or the market may have already priced in everything ahead.

Price-to-Book of -64.2x: Is it justified?

Biohaven’s price-to-book ratio is -64.2x, which stands out starkly when benchmarked against both the biotech industry and peer averages and highlights concerns over fundamentals.

The price-to-book ratio shows how the market values a company’s net assets. For companies like Biohaven, where liabilities exceed assets and equity is negative, this measure turns negative and reflects a distressed balance sheet rather than hidden value.

Compared to the US Biotechs industry average of 2.5x and a peer average of 14x, Biohaven’s negative ratio signals that the market sees significant risk in its current financial profile. In these cases, traditional valuation signals may not apply and investors should be highly cautious interpreting a negative book value as a potential “bargain.”

See what the numbers say about this price — find out in our valuation breakdown.

Result: Price-to-Book of -64.2x (ABOUT RIGHT)

However, operational losses and a volatile share price still pose significant risks. These factors could disrupt any anticipated turnaround for Biohaven in the coming quarters.

Find out about the key risks to this Biohaven narrative.

Build Your Own Biohaven Narrative

If you’d like to dig into the details and piece together your own story from the numbers, you can build your own take in just a few minutes. Do it your way

A great starting point for your Biohaven research is our analysis highlighting 1 key reward and 5 important warning signs that could impact your investment decision.

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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.

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