- AnaptysBio’s ROIC of -26.40% compared to its WACC of 13.20% indicates capital utilization inefficiencies.
- Deciphera Pharmaceuticals and other peers also show negative ROICs, highlighting industry-wide challenges in capital efficiency.
- CytomX Therapeutics stands out with a positive ROIC of 66.72% and a WACC of 9.03%, showcasing effective capital utilization.
AnaptysBio, Inc. (NASDAQ:ANAB) is a biotechnology company focused on developing antibody therapeutics for inflammation and immuno-oncology. The company is part of a competitive industry with peers like Deciphera Pharmaceuticals, Crinetics Pharmaceuticals, Rhythm Pharmaceuticals, Kura Oncology, and CytomX Therapeutics. These companies are all engaged in the development of innovative treatments, making capital efficiency a critical factor for success.
AnaptysBio’s ROIC of -26.40% compared to its WACC of 13.20% indicates that the company is not generating sufficient returns on its invested capital. This negative ROIC suggests inefficiencies in how the company utilizes its capital, which can be concerning for investors. The ROIC to WACC ratio of -2.00 further highlights this inefficiency, as the returns are not covering the cost of capital.
In comparison, Deciphera Pharmaceuticals has an even lower ROIC of -60.55% and a WACC of 5.15%, resulting in a ROIC to WACC ratio of -11.75. This suggests that Deciphera is facing significant challenges in capital utilization, with returns far below the cost of capital. Similarly, Crinetics Pharmaceuticals and Rhythm Pharmaceuticals also show negative ROICs of -28.74% and -62.80%, respectively, indicating struggles in generating adequate returns.
Kura Oncology’s ROIC of -31.40% and WACC of 6.54% result in a ROIC to WACC ratio of -4.80, showing inefficiencies similar to its peers. However, CytomX Therapeutics stands out with a positive ROIC of 66.72% and a WACC of 9.03%, leading to a ROIC to WACC ratio of 7.39. This indicates that CytomX is effectively generating returns well above its cost of capital, making it the most efficient in capital utilization among the group.
