Last Updated: 15 Sep 2024
Executive Summary
Sage Therapeutics (SAGE) is a biopharmaceutical company focused on developing and marketing drugs for disorders of the central nervous system. Despite strong revenue growth, the company remains unprofitable and faces challenges in its operating margins and return on assets. The stock price has declined significantly in the past year, and analysts have a mixed outlook on the company's future prospects.
Company Overview
Sage Therapeutics was founded in 2010 and is headquartered in Cambridge, Massachusetts. The company's lead product is Zulresso, a treatment for postpartum depression. Sage also has a pipeline of other products in development for various neurological and psychiatric disorders.
Fundamental Analysis
Revenue: Sage's revenue has grown rapidly in recent years, reaching $97.2 million in the last twelve months (TTM). Revenue growth was driven by the launch of Zulresso and increased demand for the company's other products.
Profitability: Sage is not yet profitable, with an EBITDA of -$448.1 million TTM. The company's operating margin is also negative, at -12.86%.
Valuation: Sage's stock is trading at a price-to-sales ratio of 4.916 and a price-to-book ratio of 0.761. These ratios are in line with industry averages.
Technical Analysis
Trend: Sage's stock price has been in a downtrend since early 2022. The stock is currently trading below its 50-day and 200-day moving averages.
Support and Resistance: The stock has support at around $7.19, its 52-week low. Resistance is at around $9.44, the stock's 50-day moving average.
Short Term Outlook
In the short term, Sage's stock price is likely to remain volatile. The company's profitability challenges and the overall market sentiment will continue to weigh on the stock. However, the company's strong revenue growth and pipeline of promising products could provide some support to the stock price.
Long Term Outlook
In the long term, Sage's prospects depend on the success of its pipeline products. If the company can successfully launch new products and improve its profitability, the stock price could rebound. However, if the company continues to face challenges in these areas, the stock price could continue to decline.
Analyst Recommendations
Analysts have a mixed outlook on Sage Therapeutics. Two analysts have a "Buy" rating on the stock, 17 have a "Hold" rating, and one has a "Sell" rating. The average analyst target price is $14.59, which implies a potential upside of 86%.
