Ready to invest in Verve Therapeutics now and trade it in few days?

Verve Therapeutics (VERV), a prominent player in the healthcare and biotechnology sector, is currently trading at a significant discount from its 52-week high of $27.93. With a current valuation of $608.17M, the company has a net invested capital of $550.9M and a strong balance sheet, boasting short term investments worth $439.4M. Despite an estimated loss per share of $3.55 for the current year, the company's book value per share stands at an impressive 7.50X. With 89.68% of its shares owned by institutions and a short ratio of 14.4, savvy investors might find Verve Therapeutics an intriguing proposition for potential robust returns. While many baby boomers remain indifferent towards the biotechnology sector, it may be prudent to turn our attention to Verve Therapeutics. What exactly can Verve Therapeutics shareholders expect in December? Is the current stock valuation justified? I will delve into Verve Therapeutics' perspective on valuation to provide a clearer outlook for those considering a position in this company.
Published over three months ago
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Reviewed by Rifka Kats

Verve Therapeutics (VERV) is a promising investment opportunity in the biotechnology industry, currently valued at $608.17M. Despite reporting an operating loss of $165.7M, the company has a strong Z Score of 6.71, indicating financial stability. With 10.32% of shares owned by insiders, there is a clear vested interest in the company's success. Moreover, Wall Street's target price stands at $44.22, suggesting potential for significant capital appreciation. However, potential investors should also consider the company's total debt of $81.92M before making a decision.

Important Points

Verve Therapeutics currently has liabilities amounting to 81.92 million, with a Debt to Equity (D/E) ratio of 0.0. This may suggest that the company is not leveraging borrowing to its full potential. The firm's current ratio stands at 11.32, indicating that it is sufficiently liquid and capable of meeting its financial obligations when they are due. Debt can be beneficial for Verve Therapeutics until it encounters difficulties in repayment, either through new capital or free cash flow. In such a scenario, Verve Therapeutics' shareholders could potentially lose everything if the company fails to meet its legal debt repayment obligations. However, a more common scenario is when companies like Verve Therapeutics issue additional shares at discounted prices, thereby diluting the value for existing shareholders. In this context, debt can be an excellent tool for Verve to invest in growth at high rates of return. When considering Verve Therapeutics' use of debt, it should always be evaluated in conjunction with cash and equity. Our advisory tool can cross-verify the current analyst consensus on Verve Therapeutics and analyze the company's potential for growth in the current economic cycle.
We determine the current worth of Verve Therapeutics using both absolute as well as relative valuation methodologies to arrive at its intrinsic value. In general, an absolute valuation paradigm, as applied to this company, attempts to find the value of Verve Therapeutics based exclusively on its fundamental and basic technical indicators. By analyzing Verve Therapeutics's financials, quarterly and monthly indicators, and related drivers such as dividends, operating cash flow, and various types of growth rates, we attempt to find the most accurate representation of Verve Therapeutics's intrinsic value. In some cases, mostly for established, large-cap companies, we also incorporate more traditional valuation methods such as dividend discount, discounted cash flow, or asset-based models. As compared to an absolute model, our relative valuation model uses a comparative analysis of Verve Therapeutics. We calculate exposure to Verve Therapeutics's market risk, different technical and fundamental indicators, relevant financial multiples and ratios, and then comparing them to Verve Therapeutics's related companies.

Verve Therapeutics Investment Alerts

Verve investment alerts and warnings help investors to get more proficient at understanding not only critical technical and fundamental signals but also the significant portfolio-centered indicators. These indicators include beta, alpha, and other risk-related measures that will help you in monitoring Verve Therapeutics performance across your portfolios.Please check all investment alerts for Verve

Verve Therapeutics Valuation Ratios as Compared to Competition

Our valuation model uses many indicators to compare Verve value to that of its competitors to determine the firm's financial worth. You can analyze the relationship between different fundamental ratios across Verve Therapeutics competition to find correlations between indicators driving the intrinsic value of Verve.

Verve Therapeutics Gross Profit

Verve Therapeutics Gross Profit growth is one of the most critical measures in evaluating the company. The Gross Profit growth rate is calculated simply by comparing Verve Therapeutics previous period's values with its current period's values. Each time period you're measuring should be of equal lengths the increase or decrease, in a company's Gross Profit between two periods. Here we show Verve Therapeutics Gross Profit growth over the last 10 years. Please check Verve Therapeutics' gross profit and other fundamental indicators for more details.

A Deeper Perspective

The latest indifference towards the small price fluctuations of Verve Therapeutics may raise some interest from sophisticated investors as it is trading at a share price of 15.58 on very low momentum in trading volume. The company directors and management did not add any value to Verve Therapeutics investors in October. However, most investors can still diversify their portfolios with Verve Therapeutics to hedge their inherited risk against high-volatility market scenarios. The stock standard deviation of daily returns for 90 days investing horizon is currently 6.09. The very high volatility is mostly attributed to the latest market swings and not very good earnings reports from some of the Verve Therapeutics partners.

Margins Breakdown

Verve profit margins show the degree to which it makes money. Margin indicators are used not only by investors but also by creditors or Verve Therapeutics itself as indicators of financial health and management effectiveness. Please look more closely at the different varieties of Verve Therapeutics profit margins.
EBITDA Margin(75.35)
Gross Margin0.89
Profit Margin(78.74)
Verve Therapeutics Invested Capital is fairly stable at the moment. Verve Therapeutics Free Cash Flow is decreasing over the last 5 years. Additionally, Verve Therapeutics Earnings before Tax is fairly stable at the moment.
Verve Therapeutics Invested Capital is increasing over the last 5 years. The latest value of Verve Therapeutics Invested Capital is 640,793,316. Verve Therapeutics Free Cash Flow is decreasing over the last 5 years. Additionally, Verve Therapeutics Earnings before Tax is decreasing over the last 5 years. "Buy when others are fearful" is a time-tested investment adage that may apply to Verve Therapeutics (Ticker: VERV). Despite the biotechnology company's negative net income of $157.4M and EBITDA of $204.3M, it has a robust working capital of $528.06M and cash and short-term investments totaling $554.8M. This strong liquidity position could support the company's operations and research activities in the near term. Furthermore, the company's stock has a beta of 1.61, indicating it is more volatile than the market, which could provide opportunities for investors with a high-risk tolerance. However, with a price to sales ratio of 1,294X, the stock appears overvalued, suggesting that investors may want to wait for a better entry point. The Wall Street target price of $44.22 also indicates potential upside, but investors should consider the company's financial health and market conditions before making a decision. .

Another 3 percent climb for Verve Therapeutics

Despite the recent 3% rise in Verve Therapeutics stock, investors should proceed with caution. The company's latest Treynor Ratio, a measure of risk-adjusted performance, has increased to -0.04, indicating a potential for higher risk relative to the potential return. This negative ratio suggests that the stock may face downward pressure, which could lead to a drop in price. Therefore, while the recent uptick may seem promising, the underlying risk metrics suggest a possible pullback in the near term. As of November 5th, Verve Therapeutics has a Variance of 39.49, a risk-adjusted performance of -0.002715, and a Coefficient Of Variation of -5,718. With respect to fundamental indicators, the technical analysis model allows you to examine the current technical drivers of Verve Therapeutics, as well as their interrelationships. In other words, this information can be used to determine if the company will mirror its model of past prices and volume data, or if the prices will eventually revert. We were able to interpolate data for thirteen technical drivers for Verve Therapeutics, which can be compared to its competitors. Please verify Verve Therapeutics' market risk-adjusted performance and Treynor ratio to determine if Verve Therapeutics is priced accurately, assuming the market reflects its current price of 15.58 per share.
Given that Verve Therapeutics has an information ratio of -0.009802, we recommend that you double-check Verve Therapeutics' current market performance to ensure the company can sustain itself in the future. In conclusion, Verve Therapeutics (VERV) exhibits a promising investment profile. The analyst overall consensus is a 'Buy', with a notable number of strong buys at 7 and only one strong sell. The analyst target price estimated value stands at $42.8, significantly higher than the current market value. The potential upside price of $23.82 also offers a promising return. However, investors should also consider the possible downside price of $11.63 and the company's negative EPS estimate for the next fiscal year ending in December. Despite these risks, the company's real value of $22.11 and naive expected forecast value of $17.73 suggest that the stock is undervalued. Therefore, it is reasonable to expect that Verve Therapeutics may eventually bounce back. .

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Editorial Staff

This story should be regarded as informational only and should not be considered a solicitation to sell or buy any financial products. Macroaxis does not express any opinion as to the present or future value of any investments referred to in this post. This post may not be reproduced without the consent of Macroaxis LLC. Macroaxis LLC and Raphi Shpitalnik do not own shares of Verve Therapeutics. Please refer to our Terms of Use for any information regarding our disclosure principles.

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