One-glance verdict
Within fair range
$43.29 our estimate vs market $24.80
Wall Street consensus: $46.46 (7.3% higher than our fair-value estimate)
43% below our estimate
Fundamentals snapshot
Stoke Therapeutics, Inc.
STOK · NMS · Healthcare · Biotechnology
Current price
$24.80
52-week range
$20.32 - $40.22
Market cap
$1.60B
Balance sheet
Healthy
-1.50x Concerning
Net cash $290.14M. Interest coverage shows how many times profit covers the interest bill.
What stands out
1 Reward
1 Risk
1 rewards · 1 risks
- Reward Free cash flow was positive in 1/10 years.
- Risk Return on equity was -61.1% last year — the company lost money on shareholders' equity.
What this company does
Stoke Therapeutics, Inc.
Stoke Therapeutics is a biotechnology company developing new medicines for severe genetic diseases by helping the body produce more of needed proteins. Their most advanced potential drug is for a rare form of epilepsy and is in the final stage of human testing before it can be approved for sale. Because Stoke doesn't sell any products yet, its money comes from collaboration agreements (deals with larger pharmaceutical companies who pay them to help develop these potential new treatments).
How the company got here
Stoke Therapeutics was founded in 2014 by scientists to develop medicines for severe genetic diseases. A key turning point was its initial public offering (IPO) in 2019, which provided the necessary funding to advance its research. The company has since focused on developing its proprietary TANGO platform to create a new class of medicines. Strategic collaborations with established pharmaceutical companies like Acadia Pharmaceuticals and Biogen have been crucial, providing external validation and financial support for its research programs.
What it actually does
Stoke Therapeutics is a biotechnology company working on treatments for severe genetic diseases caused by a flaw in a person's genes. It uses a specialized technology platform called TANGO (Targeted Augmentation of Nuclear Gene Output) to create medicines that help the body produce more of a necessary protein that is in short supply due to a genetic mutation. Their approach is different from many others because it doesn't try to fix or replace the broken gene, but instead boosts the output of the healthy copy of the gene that a person already has. The company's main focus is on rare diseases of the central nervous system and the eye.
Drug Development and Licensing
Stoke Therapeutics operates as a single business focused on discovering and developing new medicines. As a clinical-stage company, it does not yet have any products for sale and its revenue (the money it brings in) comes from collaboration agreements with other pharmaceutical companies. These partners, like Biogen and Acadia Pharmaceuticals, pay Stoke for the rights to help develop and potentially sell its drug candidates in certain parts of the world. This provides Stoke with upfront payments and the potential for future payments based on the achievement of specific milestones (key steps in the drug development process) and royalties (a percentage of future sales).
What management is betting on now
The company's primary focus is on its lead drug candidate, zorevunersen (also known as STK-001), for the treatment of Dravet syndrome, a severe form of epilepsy. Management is betting that successful late-stage clinical trials for this drug will not only lead to its approval but also validate their entire TANGO technology platform. This would open the door to developing treatments for a wide range of other genetic diseases. They are also advancing another potential drug, STK-002, for a genetic eye disease called autosomal dominant optic atrophy (ADOA), and are working to expand their pipeline (the group of drugs in development) to treat other rare diseases.
Price history
How the share price has moved
—
Loading price history…
Earnings history
Last 8 quarters — what happened
Click any quarter to read the call summary and what the numbers say.
FY2024 Q3
$-21.72M
FY2024 Q4
$-23.23M
FY2025 Q1
$131.68M
FY2025 Q2
$-25.58M
FY2025 Q3
$-30.50M
FY2025 Q4
$-30.69M
FY2026 Q1
$-60.94M
FY2026 Q2
$-58.56M
Revenue
$9.32M
Net income
$-61.62M
Diluted EPS
-0.93
Operating cash flow
$-56.59M
Free cash flow
$-58.56M
Fetching…
Sources
Revenue
$6.23M
Net income
$-50.00M
Diluted EPS
-0.79
Operating cash flow
$-60.58M
Free cash flow
$-60.94M
Fetching…
Sources
Revenue
$1.40M
Net income
$-57.93M
Diluted EPS
-0.97
Operating cash flow
$-30.45M
Free cash flow
$-30.69M
Fetching…
Sources
Revenue
$10.63M
Net income
$-38.35M
Diluted EPS
-0.65
Operating cash flow
$-30.37M
Free cash flow
$-30.50M
Fetching…
Sources
Revenue
$13.82M
Net income
$-23.48M
Diluted EPS
-0.40
Operating cash flow
$-25.42M
Free cash flow
$-25.58M
Fetching…
Sources
Revenue
$158.57M
Net income
$112.88M
Diluted EPS
1.90
Operating cash flow
$131.83M
Free cash flow
$131.68M
Fetching…
Sources
Revenue
$22.61M
Net income
$-10.48M
Diluted EPS
-0.15
Operating cash flow
$-23.19M
Free cash flow
$-23.23M
Fetching…
Sources
Revenue
$4.89M
Net income
$-26.43M
Diluted EPS
-0.47
Operating cash flow
$-21.61M
Free cash flow
$-21.72M
Fetching…
Sources
Is it cheap or expensive?
Fair value $43.29 vs current price $24.80
Wall Street consensus is the average analyst price target: $46.46 (7.3% higher than our fair-value estimate).
Our most-likely fair value is $43.29 a share — about 74.6% away from today's price of $24.80, so the stock currently looks fairly priced.
Is it drowning in debt?
Healthy
Net cash $290.1M - more cash than debt. Interest coverage -1.5x.
Net debt
$-290.14M
Interest coverage
-1.50x
Stoke Therapeutics, Inc.'s profit covers its interest bill about 0.0 times over. which is weaker than most peers shown here and 4 peers sit below 1x, which is the danger zone where profit does not fully cover the interest bill.
Healthy
Worse cushion
Baseline
Better cushion
STOK
BASELINE
Stoke Therapeutics, Inc.
Total debt $2.68M Interest coverage -1.50x This is the baseline the peer rows are being compared against.
Total debt $73.41M Interest coverage -15.10x Neither company has much profit cushion over interest right now.
Total debt $203.83M Interest coverage -55.80x Neither company has much profit cushion over interest right now.
Total debt $170.11M Interest coverage -5.56x Neither company has much profit cushion over interest right now.
Total debt $109.78M Interest coverage -9.33x Neither company has much profit cushion over interest right now.
What you should know
The case for and against STOK
1 Reward
1 Risk
Rewards
-
Free cash flow was positive in 1/10 years.
Risks
-
Return on equity was -61.1% last year — the company lost money on shareholders' equity.
The numbers
All the key metrics, grouped by purpose
Tap any ? icon to learn what it means.
Valuation
How expensive the stock looks
P/E (TTM)
—
Forward P/E
-7.06x
P/B
4.48x
P/S
58.01x
EV/EBITDA
-5.91x
PEG ratio
—
Profitability
How much profit each dollar creates
Gross margin
100.0%
Operating margin
-701.7%
Net margin
0.0%
ROE
-61.1%
ROA
-35.9%
Health
Liquidity and balance-sheet strength
Debt / equity
0.01x
Current ratio
7.69x
Quick ratio
7.19x
Total debt
$2.68M
Total cash
$292.82M
Growth
How the business has been compounding
Revenue TTM
$27.59M
Revenue 5Y CAGR
145.9%
EPS TTM
-3.39
EPS 5Y CAGR
—
Cash flow
How much cash the business throws off
Operating CF TTM
$-177.99M
Free CF TTM
$44.91M
FCF margin
162.8%
Dividend
Shareholder payout
Yield
—
Payout ratio
0.0%
Last ex-div date
—