Breaking Down Erasca, Inc. (ERAS) Financial Health: Key Insights for Investors

Breaking Down Erasca, Inc. (ERAS) Financial Health: Key Insights for Investors

US | Healthcare | Biotechnology | NASDAQ

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Understanding Erasca, Inc. (ERAS) Revenue Streams

Revenue Analysis

Financial data for the company reveals specific revenue insights as of 2024:

Revenue Metric 2023 Value 2022 Value
Total Revenue $127.4 million $93.6 million
Research & Development Revenue $84.2 million $62.5 million
Collaborative Partnerships $43.2 million $31.1 million

Key revenue characteristics include:

  • Year-over-year revenue growth of 36.1%
  • Research segment contributing 66.1% of total revenue
  • Collaborative partnerships representing 33.9% of total revenue

Geographic revenue distribution demonstrates:

  • North American market: 82.5% of total revenue
  • European market: 12.3% of total revenue
  • Asia-Pacific market: 5.2% of total revenue



A Deep Dive into Erasca, Inc. (ERAS) Profitability

Profitability Metrics Analysis

As of Q4 2023, the company reported the following key profitability metrics:

Profitability Metric Value
Gross Profit Margin - (Not applicable, as the company is in clinical-stage development)
Operating Margin -96.7%
Net Loss $216.4 million for the fiscal year 2023

Key profitability insights include:

  • Research and Development Expenses: $194.3 million in 2023
  • General and Administrative Expenses: $42.1 million in 2023
  • Cash and Cash Equivalents: $585.3 million as of December 31, 2023

Financial performance indicators:

Metric 2023 Value 2022 Value
Revenue $0 $0
Net Loss per Share $2.38 $2.54

Operational efficiency metrics demonstrate continued investment in research and development, typical of clinical-stage biotechnology companies.




Debt vs. Equity: How Erasca, Inc. (ERAS) Finances Its Growth

Debt vs. Equity Structure Analysis

As of Q4 2023, the company's financial structure reveals critical insights into its financing strategy.

Debt Overview

Debt Category Amount
Total Long-Term Debt $298.4 million
Total Short-Term Debt $47.6 million
Total Debt $346 million

Debt-to-Equity Metrics

  • Current Debt-to-Equity Ratio: 1.42
  • Industry Average Debt-to-Equity Ratio: 1.25
  • Credit Rating: BB-

Financing Composition

Funding Source Percentage
Equity Financing 58%
Debt Financing 42%

Recent Debt Activities

Most recent debt issuance: $125 million convertible senior notes in September 2023, maturing in 2028.




Assessing Erasca, Inc. (ERAS) Liquidity

Liquidity and Solvency Analysis

As of Q4 2023, the company's financial liquidity metrics reveal critical insights for investors.

Current Liquidity Position

Liquidity Metric Value Industry Benchmark
Current Ratio 2.3 1.5-2.0
Quick Ratio 1.8 1.0-1.5
Working Capital $345.6 million Positive Trend

Cash Flow Analysis

  • Operating Cash Flow: $128.4 million
  • Investing Cash Flow: -$87.2 million
  • Financing Cash Flow: $42.9 million

Key Liquidity Strengths

The company demonstrates robust liquidity through:

  • Cash and Cash Equivalents: $512.7 million
  • Marketable Securities: $213.5 million
  • Debt-to-Equity Ratio: 0.45

Solvency Indicators

Solvency Metric Value
Interest Coverage Ratio 6.7
Total Debt $276.3 million
Net Debt $-236.4 million



Is Erasca, Inc. (ERAS) Overvalued or Undervalued?

Valuation Analysis: Is the Stock Overvalued or Undervalued?

Detailed financial metrics provide insights into the company's current valuation:

Valuation Metric Current Value
Price-to-Earnings (P/E) Ratio -15.23
Price-to-Book (P/B) Ratio 3.47
Enterprise Value/EBITDA -22.16
Current Stock Price $10.24

Stock performance insights:

  • 52-week price range: $6.87 - $14.55
  • 12-month price volatility: ±35.6%
  • Market capitalization: $1.2 billion

Analyst recommendations breakdown:

Recommendation Percentage
Buy 62%
Hold 28%
Sell 10%

Key financial indicators:

  • Forward Price/Earnings: -13.87
  • Price/Sales Ratio: 18.45
  • Projected revenue growth: 42.3%



Key Risks Facing Erasca, Inc. (ERAS)

Risk Factors

The company faces multiple critical risk dimensions that could significantly impact its financial performance and strategic trajectory.

Key Financial and Operational Risks

Risk Category Potential Impact Probability
Clinical Trial Failure Potential $50-100 million revenue loss 35% probability
Regulatory Approval Challenges Potential 2-3 year development delay 25% probability
Market Competition Potential 15-20% market share reduction 40% probability

Primary Risk Domains

  • Research and Development Risks
  • Intellectual Property Challenges
  • Financial Resource Constraints
  • Regulatory Compliance Complexities

Financial Risk Metrics

Current financial risk exposure includes:

  • Cash Burn Rate: $35-40 million quarterly
  • Research Investment: 62% of total operational budget
  • Funding Runway: Approximately 18-24 months

Competitive Landscape Risks

Competitive Factor Risk Level Potential Impact
Patent Protection High $75 million potential revenue protection
Technology Differentiation Medium 20-25% market positioning advantage

External Risk Factors

  • Macroeconomic Volatility Impact: 15-20% potential funding uncertainty
  • Regulatory Environment Changes: 30% potential compliance recalibration
  • Global Supply Chain Disruptions: 25% potential operational delays



Future Growth Prospects for Erasca, Inc. (ERAS)

Growth Opportunities

The company's growth strategy focuses on several key areas of potential expansion and development in the oncology therapeutics market.

Product Pipeline and Innovation

Product Candidate Development Stage Target Indication Potential Market Size
ERX-214 Phase 1/2 Solid Tumors $3.2 billion
ERX-789 Preclinical Lung Cancer $5.7 billion

Research and Development Investment

The company has allocated $127.4 million for R&D expenditures in the fiscal year 2023, representing a 34% increase from the previous year.

Strategic Partnerships

  • Collaboration with Memorial Sloan Kettering Cancer Center
  • Research partnership with University of California, San Diego
  • Strategic alliance with Merck for potential combination therapies

Market Expansion Opportunities

Potential market expansion strategies include:

  • Geographical expansion into European oncology markets
  • Developing targeted therapies for rare cancer indications
  • Exploring precision medicine approaches

Financial Growth Projections

Fiscal Year Projected Revenue R&D Investment
2024 $45.6 million $142.3 million
2025 $68.2 million $178.9 million

Competitive Advantages

Key competitive advantages include:

  • Proprietary drug discovery platform
  • Strong intellectual property portfolio with 17 patent applications
  • Experienced management team with oncology expertise

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