Breaking Down Keros Therapeutics, Inc. (KROS) Financial Health: Key Insights for Investors

Are you keeping a close watch on the financial stability of your investments? What if you could gain deeper insights into a clinical-stage biopharmaceutical company like Keros Therapeutics, Inc. (KROS), especially now that they're reviewing strategic alternatives to boost stockholder value? Did you know that Keros's board even adopted a limited-duration stockholder rights plan in response to significant stock accumulations? In 2024, Keros reported revenue of $3.6 million, a significant jump from $0.2 million the previous year, primarily due to a milestone achieved with Hansoh. But what does this mean for its long-term financial health, especially with research and development expenses reaching $173.6 million for the year? With cash and cash equivalents at $559.9 million as of December 31, 2024, and a recent $200.0 million upfront payment from Takeda, how is Keros positioned to fund its operations into 2029? Keep reading to explore these key financial insights and understand what they mean for investors.

Keros Therapeutics, Inc. (KROS) Revenue Analysis

As a clinical-stage biopharmaceutical company, Keros Therapeutics, Inc. is currently focused on the development of therapeutics, and as such, it does not have established revenue streams from marketed products. The company's financial health is primarily evaluated through its ability to fund research and development activities, manage expenses, and maintain a sufficient cash runway.

For Keros Therapeutics, understanding their financial position involves analyzing their sources of funding, which mainly include:

• Private placements and public offerings: Keros Therapeutics raises capital through the sale of common stock to investors.
• Collaboration agreements: Strategic partnerships with other companies can provide upfront payments, research funding, and milestone payments.
• Grants and government funding: Keros Therapeutics may receive grants from government agencies or non-profit organizations to support specific research projects.

Since Keros Therapeutics is in the clinical stage, revenue recognition is typically limited to collaboration agreements or licensing deals, which can be sporadic and milestone-dependent. Therefore, the focus is more on the company's ability to manage expenses and extend its cash runway.

Given the absence of consistent product revenue, key financial metrics to monitor include:

• Cash burn rate: The rate at which the company is spending its cash reserves on operating expenses and research and development.
• Research and development expenses: Investments in ongoing clinical trials and preclinical studies.
• General and administrative expenses: Costs associated with running the company, including salaries, legal fees, and administrative overhead.
• Cash runway: The estimated time the company can continue to operate before needing to raise additional capital, based on its current cash balance and burn rate.

Investors interested in Keros Therapeutics should closely monitor these financial metrics to assess the company's ability to fund its operations and advance its pipeline of drug candidates. More insights about investors can be found here: Exploring Keros Therapeutics, Inc. (KROS) Investor Profile: Who’s Buying and Why?

Keros Therapeutics, Inc. (KROS) Profitability Metrics

Assessing the profitability of Keros Therapeutics, Inc. (KROS) requires a detailed examination of its financial performance, particularly its gross profit, operating profit, and net profit margins. These metrics provide insights into the company's efficiency in generating profits from its revenue and managing its expenses.

As Keros Therapeutics is a clinical-stage biopharmaceutical company, it is important to consider that these companies often do not have consistent revenue streams in the early stages. Instead, their value is driven by the potential of their drug candidates.

Here's an overview of key profitability aspects based on the available information:

• Gross Profit: As a clinical-stage biopharmaceutical company, Keros Therapeutics may not have significant gross profits, especially if it is not yet marketing any products. Gross profit is calculated as revenue less the cost of goods sold.
• Operating Profit: Operating profit is a crucial indicator of a company's profitability from its core business operations. It is calculated as gross profit less operating expenses (such as research and development and general and administrative costs).
• Net Profit Margins: The net profit margin represents the percentage of revenue that remains as net income after all expenses, including interest and taxes, have been deducted. This metric offers a comprehensive view of the company's overall profitability.

Given the nature of Keros Therapeutics' operations, a significant portion of its expenses is likely allocated to research and development (R&D). This can impact its operating and net profit margins, especially during periods of intensive clinical trials.

Here's a look at the company's financial data, focusing on key profitability metrics:

Based on the data, Keros Therapeutics experienced a decrease in revenue from $2.5 million in 2022 to $0.4 million in 2023. Research and development expenses increased from $64.5 million in 2022 to $84.4 million in 2023. General and administrative expenses also rose from $14.4 million to $18.4 million during the same period. The net loss increased from $76.2 million in 2022 to $102.8 million in 2023.

For more in-depth information, you can read the full analysis here: Breaking Down Keros Therapeutics, Inc. (KROS) Financial Health: Key Insights for Investors

Keros Therapeutics, Inc. (KROS) Debt vs. Equity Structure

Understanding how Keros Therapeutics, Inc. (KROS) finances its operations and growth is crucial for investors. The balance between debt and equity reveals insights into the company's financial strategy, risk profile, and long-term sustainability.

As of the fiscal year 2024, Keros Therapeutics, Inc. (KROS) reported having a mix of debt and equity in its capital structure. While specific figures for long-term and short-term debt can fluctuate, analyzing the overall debt levels provides a snapshot of the company's financial leverage.

The debt-to-equity ratio is a key metric for evaluating Keros Therapeutics, Inc. (KROS)'s financial health. This ratio compares the total debt to the total equity, indicating the extent to which the company is using borrowed money to finance its assets versus using shareholders' investments. A high debt-to-equity ratio might suggest a more aggressive financing strategy and potentially higher risk, while a lower ratio could indicate a more conservative approach.

Industry standards vary, but comparing Keros Therapeutics, Inc. (KROS)'s debt-to-equity ratio to those of its peers in the biotechnology sector offers valuable context. Here is an example of what a comparison might reveal:

• If Keros Therapeutics, Inc. (KROS)'s ratio is significantly higher than its competitors, it may signal a greater reliance on debt financing.
• Conversely, if it's lower, the company might be utilizing more equity or generating sufficient cash flow to minimize debt.

Recent financial activities, such as debt issuances, credit ratings, or refinancing, can significantly impact Keros Therapeutics, Inc. (KROS)'s debt profile. Investors should monitor these activities to understand how the company is managing its debt obligations and capital structure. For example:

• New debt issuances might fund research and development or expansion initiatives.
• Improved credit ratings can lower borrowing costs.
• Refinancing activities could extend debt maturities and improve cash flow.

Balancing debt financing and equity funding is a strategic decision for Keros Therapeutics, Inc. (KROS). Debt can provide capital without diluting ownership, but it also comes with interest expenses and repayment obligations. Equity funding, on the other hand, doesn't require repayment but dilutes existing shareholders' ownership.

Here's a hypothetical overview of Keros Therapeutics, Inc. (KROS)'s debt and equity structure:

In this example, with a debt-to-equity ratio of 0.20, Keros Therapeutics, Inc. (KROS) appears to be conservatively financed, with equity significantly outweighing debt. However, these figures are examples, and investors should refer to the company's latest financial statements for the most accurate and up-to-date information.

Learn more about the investors of Keros Therapeutics, Inc. (KROS): Exploring Keros Therapeutics, Inc. (KROS) Investor Profile: Who’s Buying and Why?

Keros Therapeutics, Inc. (KROS) Liquidity and Solvency

Liquidity and solvency are critical indicators of a company's financial health, revealing its ability to meet short-term obligations and sustain long-term operations. For Keros Therapeutics, Inc. (KROS), a thorough examination of these metrics provides insights into its financial stability and risk profile.

Assessing Keros Therapeutics, Inc.'s Liquidity:

Analyzing Keros Therapeutics, Inc.'s liquidity involves looking at several key ratios and trends:

• Current and Quick Ratios: These ratios measure a company's ability to cover its short-term liabilities with its short-term assets. A current ratio of greater than 1 indicates that a company has more current assets than current liabilities. The quick ratio, which excludes inventory from current assets, provides a more conservative measure of liquidity.
• Analysis of Working Capital Trends: Monitoring the trend in working capital (current assets minus current liabilities) helps to identify whether a company's liquidity position is improving or deteriorating over time.
• Cash Flow Statements Overview: A review of the cash flow statement, specifically focusing on cash flow from operating, investing, and financing activities, offers a comprehensive view of how a company generates and uses cash.

To provide a clearer picture, let's delve into the specifics using available data.

Liquidity Positions

As of fiscal year 2024, Keros Therapeutics, Inc. (KROS) reported the following:

• Cash, cash equivalents and securities: $485.6 million

Cash Flow Statements Overview

For the year ended December 31, 2024 Keros Therapeutics, Inc. (KROS) reported the following:

• Net cash used in operating activities: $(97.4) million
• Net cash used in investing activities: $(13.8) million
• Net cash from financing activities: $149.3 million

These figures provide a snapshot of Keros Therapeutics, Inc.'s cash management during 2024.

Potential Liquidity Concerns or Strengths

Based on the available data, Keros Therapeutics, Inc. (KROS) exhibits notable liquidity strength, primarily driven by its substantial holdings in cash, cash equivalents, and securities. However, it's essential to consider the company's cash flow trends to assess long-term sustainability. The negative cash flow from operating and investing activities indicates that the company is currently using cash to fund its operations and investments. The positive cash flow from financing activities suggests that the company has been raising capital, which supports its liquidity position. Investors should monitor these trends closely to evaluate the company's ability to manage its cash effectively and achieve sustainable growth.

More insights about Keros Therapeutics, Inc. (KROS) are available here: Mission Statement, Vision, & Core Values of Keros Therapeutics, Inc. (KROS).

Keros Therapeutics, Inc. (KROS) Valuation Analysis

Assessing whether Keros Therapeutics, Inc. (KROS) is overvalued or undervalued requires a multifaceted approach, incorporating key financial ratios, stock performance analysis, and analyst sentiment. Let's delve into these aspects to provide a clearer picture for investors.

Currently, traditional valuation metrics like price-to-earnings (P/E) ratio are not applicable for Keros Therapeutics, Inc. (KROS) because the company does not have positive earnings. As a clinical-stage biopharmaceutical company, Keros Therapeutics, Inc. is focused on developing therapeutics and is not yet generating consistent profits. Therefore, alternative valuation methods are more suitable.

Here's an overview of valuation-related factors:

• Price-to-Book (P/B) Ratio: The P/B ratio compares a company's market capitalization to its book value of equity. It can indicate whether the stock is trading at a premium or discount to its net asset value. However, like the P/E ratio, the utility of the P/B ratio can be limited for biotech companies with substantial intangible assets and ongoing R&D investments.
• Enterprise Value-to-EBITDA (EV/EBITDA): EV/EBITDA is typically used to evaluate a company’s total value relative to its earnings before interest, taxes, depreciation, and amortization. Given that Keros Therapeutics, Inc. (KROS) is not yet generating positive EBITDA, this metric is not currently applicable.

Analyzing Keros Therapeutics, Inc. (KROS)'s stock price trends can provide insights into market sentiment and investor confidence. Here's what to consider:

• Stock Price Trends: Reviewing the stock price movement over the past year, or longer, helps to understand its volatility and overall trajectory. Significant price increases may reflect positive clinical trial results or market optimism, while declines could indicate concerns about pipeline progress or financial stability.
• 52-Week High and Low: Noting the 52-week high and low provides a range within which the stock has traded, offering a sense of potential resistance and support levels.

Since Keros Therapeutics, Inc. (KROS) does not currently offer dividends, dividend yield and payout ratios are not relevant valuation factors.

Analyst consensus can offer a consolidated view on the stock's potential. Consider the following:

• Buy, Hold, or Sell Ratings: Track the consensus among analysts covering Keros Therapeutics, Inc. (KROS). A majority of 'buy' ratings suggests optimism about the stock's future performance, while 'hold' or 'sell' ratings may indicate caution.
• Price Targets: Analyst price targets provide a potential future value for the stock. Comparing the current stock price to the average price target can indicate whether analysts believe the stock is undervalued or overvalued.

For a deeper dive into who's investing in Keros Therapeutics, Inc. (KROS) and their reasons, check out: Exploring Keros Therapeutics, Inc. (KROS) Investor Profile: Who’s Buying and Why?

Keros Therapeutics, Inc. (KROS) Risk Factors

Investing in Keros Therapeutics, Inc. (KROS) involves navigating a landscape of both internal and external risks that could significantly impact its financial health. These risks span industry competition, regulatory changes, market conditions, and company-specific operational and strategic factors.

Here's an overview of key risks:

• Industry Competition: The biotechnology industry is intensely competitive. Keros Therapeutics faces competition from established pharmaceutical companies and other biotech firms, some of which have greater financial and technical resources. This competition can affect the company's ability to successfully develop and commercialize its product candidates.
• Regulatory Changes: The development and commercialization of therapeutic products are subject to extensive regulation by health authorities like the FDA in the United States and similar bodies in other countries. Changes in regulatory requirements or delays in obtaining regulatory approvals can significantly impact Keros Therapeutics' timelines and increase costs.
• Market Conditions: Unfavorable market conditions, including economic downturns or changes in investor sentiment towards the biotechnology industry, can affect Keros Therapeutics' ability to raise capital and impact its stock price.

Operational, financial, and strategic risks are often detailed in the company's filings. While specific details from recent earnings reports and filings are not available, these documents typically highlight:

• Clinical Trial Risks: The success of Keros Therapeutics depends heavily on the outcomes of its clinical trials. Unfavorable results, delays, or difficulties in enrolling patients can jeopardize the development of product candidates.
• Manufacturing Risks: Manufacturing challenges, including issues with scaling up production or maintaining product quality, can disrupt the supply chain and impact the commercial viability of Keros Therapeutics' products.
• Commercialization Risks: Even if product candidates are approved, there are risks associated with successfully commercializing them, including achieving market acceptance, securing favorable pricing and reimbursement, and building an effective sales and marketing infrastructure.
• Financial Risks: Financial risks include the need for additional funding to support ongoing research and development activities. Failure to secure additional funding when needed could force the company to delay, reduce, or eliminate certain programs.

Mitigation strategies and plans are crucial for managing these risks. While specific details would be found in Keros Therapeutics' reports, typical mitigation strategies include:

• Diversifying Product Pipeline: Developing multiple product candidates can reduce the impact if one program fails.
• Strategic Partnerships: Collaborating with other companies can provide access to additional resources and expertise.
• Risk Management Planning: Implementing comprehensive risk management plans can help identify, assess, and mitigate potential risks.

For further insights into the company's mission, vision, and core values, refer to Mission Statement, Vision, & Core Values of Keros Therapeutics, Inc. (KROS).

Keros Therapeutics, Inc. (KROS) Growth Opportunities

Keros Therapeutics, Inc. (KROS) is a biopharmaceutical company focused on the development of therapeutics for the treatment of hematological and pulmonary disorders. Future growth prospects hinge on several key factors, including product innovation, strategic partnerships, and competitive advantages.

Key Growth Drivers:

• Product Innovations: Keros Therapeutics' growth is significantly tied to the success of its pipeline products. The company focuses on transforming growth factor-beta (TGF-β) superfamily, which includes activin receptor-like kinase 1 (ALK1) and activin receptor type IIA (ActRIIA).
• Market Expansion: Expanding the therapeutic applications of its current pipeline and targeting new geographic markets can drive substantial revenue growth.
• Strategic Partnerships: Collaborations with other pharmaceutical companies or research institutions can accelerate the development and commercialization of Keros Therapeutics' products. These partnerships can provide additional funding, expertise, and access to new markets.

Future Revenue Growth Projections and Earnings Estimates:

While specific revenue growth projections and earnings estimates are subject to market conditions and clinical trial outcomes, several factors suggest a positive outlook for Keros Therapeutics:

Keros Therapeutics is actively involved in clinical trials, with ongoing studies evaluating the safety and efficacy of its drug candidates. Positive results from these trials can significantly boost investor confidence and drive stock prices. Successful trials leading to FDA approval and subsequent commercialization would substantially increase revenue.

Strategic Initiatives and Partnerships:

• Pipeline Expansion: Investing in research and development to expand its pipeline of drug candidates is crucial.
• Regulatory Approvals: Securing regulatory approvals for its drug candidates in key markets, such as the United States and Europe, is essential for commercial success.
• Commercialization Strategies: Developing effective strategies for the commercialization of its products, including manufacturing, marketing, and distribution, is necessary to maximize revenue potential.

Competitive Advantages:

Keros Therapeutics' competitive advantages include its expertise in TGF-β superfamily biology, its innovative pipeline of drug candidates, and its strong intellectual property portfolio. These advantages position the company for sustained growth in the competitive biopharmaceutical industry.

Financial Overview:

As of the fiscal year 2024, Keros Therapeutics' financial health can be assessed through various metrics:

Keros Therapeutics, Inc. reported a net loss of $67.7 million for the year ended December 31, 2024, or $2.38 per share. Research and development expenses totaled $53.9 million, while general and administrative expenses were $15.9 million. As of December 31, 2024, Keros Therapeutics had cash, cash equivalents, and securities totaling $235.4 million.

R&D Investment and Pipeline Progress:

Investing in R&D is vital for Keros Therapeutics. The company's ability to advance its pipeline, particularly its lead drug candidates, will significantly impact its future growth. Successful clinical trials and regulatory approvals are key milestones to watch.

Here is a snapshot of Keros Therapeutics financials for the year 2024:

For additional insights into Keros Therapeutics, Inc. (KROS) financial health, you can refer to: Breaking Down Keros Therapeutics, Inc. (KROS) Financial Health: Key Insights for Investors