ABIO  Arca Biopharma Inc.

Exchange

NASDAQ

Sector

Health Care

Industry

Biotechnology: In Vitro & In Vivo Diagnostic Substances

Market Cap.

23.39M

Vuru Grade

49.00/100

Current Price

$2.58
+0.025 (+0.980%)

Stability Price

$9.20
Undervalued by 257.18%

Company Metrics

  • P/E 1.34
  • P/S 0
  • P/B 0.874
  • EPS -1.695
  • Cash ROIC 1,403.45%
  • Cash Ratio 25.80
  • Dividend 0 / 0%
  • Avg. Vol. 31,284.00
  • Shares 6.29M
  • Market Cap. 23.39M

Company Description

ARCA biopharma, Inc., a biopharmaceutical company, engages in the development of genetically-targeted therapies for cardiovascular diseases. Its principal product candidate, Gencaro (bucindolol hydrochloride), is an investigational, pharmacologically unique beta-blocker and mild vasodilator being developed for the treatment of chronic heart failure and also for the prevention of atrial fibrillatio... more


Download 10 Years of Financial Statements:
Income Statement   Balance Sheet   Cash Flow

News

Anders Hove, MD Joins ARCA biopharma Board of Directors
Business Wire (press release) - Feb 21, 2017
WESTMINSTER, Colo.--(BUSINESS WIRE)--ARCA biopharma, Inc. (Nasdaq: ABIO), a biopharmaceutical company applying a precision medicine approach to developing genetically-targeted therapies for cardiovascular diseases, today announced that ...
ARCA biopharma, Inc.'s (ABIO), a stock from Biotechnology Industry, is worth ... - Street Updates
ARCA Biopharma, Inc. (ABIO) – Latest Broker Consensus - NewsDen
ARCA biopharma, Inc. (NASDAQ:ABIO) Files An 8-K Departure of Directors or ...
Market Exclusive - Feb 21, 2017
ARCA biopharma, Inc. (NASDAQ:ABIO) Files An 8-K Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.
ARCA Biopharma: Low Valuation On Past Failures, High Upside And Limited Risk ...
Seeking Alpha - Nov 30, 2016
ARCA Biopharma (NASDAQ: ABIO) is a development stage biotech company that has been beaten down over several decades. Their flagship therapeutic candidate, Gencaro® is a beta-blocker that has seen multiple efficacy issues in outcomes measures.
Why Arca Biopharma Is A Buy
Seeking Alpha - Jan 14, 2014
Arca Biopharma (NASDAQ:ABIO) is a pre-revenue company that has patents through 2029 covering the drug Gencaro (generic: bucindolol).
BRIEF-Arca Biopharma entered into capital on demand sales agreement with ...
Reuters - Jan 11, 2017
LAGOS, Feb 18 Nigeria's central bank plans to boost dollar sales for school fee payment and travel abroad so as to reduce the premium paid on the black market and support the naira, a senior banker said on Saturday.
Arca Biopharma (ABIO) Enters Agreement to Offer Up to $7.3M in Common Stock
StreetInsider.com - Jan 11, 2017
On January 11, 2017, ARCA biopharma, Inc. (the “Company”) entered into a Capital on DemandTM Sales Agreement (the “Sales Agreement”) with JonesTrading Institutional Services LLC, as agent (“JonesTrading”), pursuant to which the Company may offer ...
ARCA biopharma Gains on Fast Track Status for Gencaro
Zacks.com - Apr 14, 2015
ARCA biopharma, Inc. shares gained 13.4% after the company announced that it has received Fast Track designation from the FDA for its lead pipeline candidate, Gencaro.
ARCA biopharma Announces Randomization of First European Patients in GENETIC ...
Business Wire (press release) - Oct 6, 2016
WESTMINSTER, Colo.--(BUSINESS WIRE)--ARCA biopharma, Inc. (Nasdaq: ABIO), a biopharmaceutical company applying a precision medicine approach to the development of genetically-targeted therapies for cardiovascular diseases, today announced ...
Patient Randomized into the GENETIC-AF Phase 2B/3 Clinical Trial
Business Wire (press release) - Aug 18, 2016
WESTMINSTER, Colo.--(BUSINESS WIRE)--ARCA biopharma, Inc. (Nasdaq: ABIO), a biopharmaceutical company applying a precision medicine approach to developing genetically-targeted therapies for cardiovascular diseases, today announced that the ...
Arca Biopharma Inc (NASDAQ:ABIO) Might Climb The Nasdaq Stock Ladder After ...
FinancialsTrend - Feb 22, 2017
Arca Biopharma Inc (NASDAQ:ABIO) has announced its decision to take up the services of Anders Hove, a managing director as part of its board of directors.
Growth Rate Assumed by Market

We did a reverse valuation to calculate the growth rate the market is assuming for ABIO to be considered fairly valued at its current market price. It's useful to compare this to the growth rate we're assuming for the Growth Price.

Future Free Cash Flow Growth Rate

This is the annual growth rate we've applied to calculate ABIO's Free Cash Flow for the next 10 years. To calculate it, we looked at several time periods of the last 10 years. Feel free to adjust it, but we limit the initial growth rate to 20% and slow it down over the years. Otherwise, long-term sustainability issues come into play.

Discount Rate

The discount rate is the annual rate of return an investor requires to take the risk of investing in a single stock. To account for that risk, this should be above 8-10%, as this is the avg. annual rate of return for the S&P500 over the past 100 years.

$2.58 Current Price

$-4.74 Growth Price (DCF)

Why is this negative?


Show Free Cash Flow numbers

$9.20 Stability Price (EPV)

Undervalued by 257.18%


Discount Rate: 15.0%

$5.95 NCA Price

Undervalued by 131.01%

$9.34 Book Price

Undervalued by 262.70%


Varying Cash Return on Invested Capital over the past 5 years

ABIO has efficiently invested its financial resources in buildings, projects, and equipment, resulting in strong returns. However, there is a substantial variation in their Cash ROIC from year-to-year. This company may have unreliable free cash flow or operates in a business where invested capital costs increase substantially on a sporadic basis. Look at reasons for this inconsistency to determine the likelihood of future sustainability.

ABIO has created $1,403.45 of cash for every $100 invested.
Figures in USD. Fiscal year ends in December
20112012201320142015
Free Cash Flow -6.98M - -5.32M -9.43M -10.55M
divided by
Invested Capital -195,000.00 -13,000.00 -1.17M -610,000.00 -732,000.00
Cash ROIC 3,578.46% - 453.15% 1,545.08% 1,440.57%

Very Poor Return on Equity over the past 5 years

ABIO has shown an inability to deliver results for shareholders. This could be due to poor management, ABIO operating in a highly competitive industry, or having a weak business in general.

ABIO has generated a $76.50 loss for every $100 of Shareholders' Equity.
Figures in USD. Fiscal year ends in December
20112012201320142015
Net Income -5.36M -4.32M -6.94M -9.69M -11.45M
divided by
Stockholders' Equity 5.73M 2.91M 15.58M 14.74M 38.07M
Return on Equity -93.58% -148.61% -44.54% -65.73% -30.06%

Poor Business Performance over the past 10 years

ABIO's inability to produce positive free cash flow for the majority of the past 10 years is concerning. It should be a red flag, since this company does not have a track record of delivering results for shareholders. This could be due to poor management or the nature of its business.

ABIO has been losing money for the majority of the past 10 years.
Figures in USD. Fiscal year ends in December
2006200720082009201020112012201320142015
Free Cash Flow -39.50M -46.34M -46.73M -41.91M -8.33M -6.98M - -5.32M -9.43M -10.55M

Very Strong Balance Sheet

ABIO has more Cash than its Total Liabilities, resulting in $5.93 Net Cash per share. In other words, if you buy ABIO today, the price you're paying for shares is actually $-3.36 because $5.93 of Cash is included in the current share price. This much Cash is very healthy. It can help ABIO sustain itself in the face of any economic turmoil and makes a stock buyback more of a possibility.
Figures in USD. Fiscal year ends in December
2006200720082009201020112012201320142015
Cash 153.13M 97.57M 50.97M 7.76M 7.03M 5.94M 2.92M 16.76M 15.35M 38.80M
Current Assets 166.34M 99.99M 52.13M 8.29M 7.16M 6.21M 3.05M 16.93M 15.49M 38.92M
Total Assets 184.41M 120.68M 66.05M 9.37M 8.16M 6.50M 3.21M 17.08M 16.13M 39.57M
Current Liabilities 43.84M 18.19M 11.35M 1.64M 1.19M 754,000.00 305,000.00 1.50M 1.39M 1.50M
Total Liabilities 114.56M 53.02M 23.54M 1.96M 1.39M 770,000.00 305,000.00 1.50M 1.39M 1.50M
Stockholder' Equity 69.84M 67.66M 42.51M 7.41M 6.77M 5.73M 2.91M 15.58M 14.74M 38.07M
Current Ratio 3.79 5.50 4.59 5.04 6.02 8.24 9.98 11.27 11.16 25.88
TL-to-TA 0.62 0.44 0.36 0.21 0.17 0.12 0.09 0.09 0.09 0.04

Low or No Reinvestment of Profits over the past 10 years

ABIO has either been retaining a small amount of their earnings or has done so inconsistently. A lack of consistency could be due to ABIO operating at a loss or them having such a strong economic moat they feel comfortable spending profits on growth. Be wary of future prospects and if applicable, inspect the moat's sustainability.
Figures in USD. Fiscal year ends in December
2006200720082009201020112012201320142015
Retained Earnings -458.21M -470.51M -500.44M -49.89M -58.31M -63.67M -67.99M -74.93M -84.62M -96.07M
Retained Earnings Growth - -2.68% -6.36% 90.03% -16.88% -9.20% -6.78% -10.21% -12.93% -13.52%

Erratic Net Profit Margins over the past 10 years

ABIO has had highly erratic net profit margins which are a great cause for concern. This company may operate in a highly volatile industry, or it may just have poor performance. Look at reasons for this inconsistency to understand if there is any reason to look past it.
Figures in USD. Fiscal year ends in December
2006200720082009201020112012201320142015
Net Income -132.78M -12.30M -29.92M -9.14M -8.42M -5.36M -4.32M -6.94M -9.69M -11.45M
divided by
Revenue 3.89M 46.86M 15.25M - - - - - - -
Net Profit Margin -3,415.05% -26.25% -196.20% - - - - - - -

Inconsistent Gross Profit Margins over the past 10 years

ABIO has good gross profit margins, however inconsistency of these margins is a cause for concern. Look at reasons for this inconsistency to determine the likelihood of future sustainability.

$30.00 of every $100 worth of sales have been Gross Profit, on average over the past 10 years.
Figures in USD. Fiscal year ends in December
2006200720082009201020112012201320142015
Gross Profit 3.89M 46.86M 15.25M - - -2.32M - - - -
divided by
Revenue 3.89M 46.86M 15.25M - - - - - - -
Gross Margin 100.00% 100.00% 100.00% - - - - - - -

Low Capital Intensity over the past 10 years

ABIO has consistently used a small portion of their Net Income buying new equipment or investing in new facilities. This indicates that ABIO may require minimal investment to stay competitive. This leaves them with extra money to spend on growing their business and potentially buying back stock.

-% of Profits are being spent on Capital Expenditures, like Property, Plant, & Equipment, required to run the business.
Figures in USD. Fiscal year ends in December
2006200720082009201020112012201320142015
Capital Expenditure 2.44M 381,000.00 222,000.00 185,000.00 4,000.00 19,000.00 - 32,000.00 19,000.00 11,000.00
divided by
Net Income -132.78M -12.30M -29.92M -9.14M -8.42M -5.36M -4.32M -6.94M -9.69M -11.45M
Capital Expenditure Ratio -1.84% -3.10% -0.74% -2.02% -0.05% -0.35% - -0.46% -0.20% -0.10%

No Dividend History over the past 10 years

ABIO has never distributed dividends or has recently suspended their dividend distribution.
Figures in USD. Fiscal year ends in December
2006200720082009201020112012201320142015
Dividend Paid - - - - - - - - - -
divided by
Shares Outstanding 2.57M 2.67M 2.68M 7.09M 8.51M 10.04M 2.22M 8.63M 20.50M 6.29M
Dividend Paid Per Share - - - - - - - - - -
Price at Year End 80.00 38.00 6.20 3.19 3.21 1.00 0.38 1.70 0.92 4.93
Dividend Yield - - - - - - - - - -

History of Stock Buybacks over the past 10 years

ABIO has some history of delivering increased value for shareholders in the form of stock buybacks. These have helped improve financial metrics and increase each shareholders' relative ownership stake in the company, due to fewer shares outstanding and holding the same number of shares.
Figures in USD. Fiscal year ends in December
2006200720082009201020112012201320142015
Shares Outstanding 2.57M 2.67M 2.68M 7.09M 8.51M 10.04M 2.22M 8.63M 20.50M 6.29M
Stock Bought Back - -3.53% -0.46% -62.23% -16.62% -15.26% 351.46% -74.23% -57.91% 225.97%
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