Breaking Down Soleno Therapeutics, Inc. (SLNO) Financial Health: Key Insights for Investors

Are you keeping a close watch on Soleno Therapeutics, Inc. (SLNO) and wondering about its financial stability? As of December 31, 2024, the company reported a strong cash position of $318.6 million. However, the company also reported a net loss of $(175.9) million, or $(4.38) per share for 2024. With significant developments like the FDA granting Priority Review and Breakthrough Therapy Designation for DCCR, is Soleno positioned for growth, or are there financial challenges ahead that investors should consider? Dive in to explore the key financial insights that could shape your investment decisions.

Soleno Therapeutics, Inc. (SLNO) Revenue Analysis

As of now, Soleno Therapeutics, Inc. (SLNO) does not have any revenue streams because it is a clinical-stage biopharmaceutical company focused on developing and commercializing novel therapeutics for the treatment of rare diseases. The company does not have any products approved for sale. Thus, detailed information on revenue streams, year-over-year growth, and segment contributions is currently unavailable.

Soleno Therapeutics is focused on developing and commercializing therapeutics for rare diseases. Their lead product candidate, Diazoxide Choline Controlled-Release (DCCR) is being developed for the treatment of Prader-Willi Syndrome (PWS). As a clinical-stage company, Soleno Therapeutics' financial health is closely tied to its ability to secure funding, advance its clinical trials, and eventually gain regulatory approval for its product candidates.

For further insights into the company's strategic goals, refer to: Mission Statement, Vision, & Core Values of Soleno Therapeutics, Inc. (SLNO).

Soleno Therapeutics, Inc. (SLNO) Profitability Metrics

Analyzing Soleno Therapeutics, Inc. (SLNO)'s profitability involves scrutinizing several key financial metrics to understand its financial health and operational efficiency. Given the company's developmental stage, traditional profitability measures may not always present a complete picture. Therefore, a comprehensive approach is essential.

Here's an overview of what to consider when evaluating Soleno Therapeutics, Inc. (SLNO)'s profitability:

• Gross Profit: This metric reflects the revenue remaining after deducting the cost of goods sold (COGS). For Soleno Therapeutics, Inc. (SLNO), monitoring gross profit helps assess the efficiency of its production and operations.
• Operating Profit: Operating profit is calculated by subtracting operating expenses (such as administrative and R&D costs) from gross profit. It indicates how well the company manages profits from its core business operations.
• Net Profit: Net profit represents the actual profit after deducting all expenses, including interest and taxes. This is a key indicator of overall financial performance.

Since Soleno Therapeutics, Inc. (SLNO) is a biotechnology company, a significant portion of its expenses is related to Research and Development (R&D). These expenses can impact profitability metrics substantially, especially during clinical trials and the drug development phases. Investors should, therefore, focus on trends in R&D spending relative to potential future revenues from successful products.

Understanding the trends in profitability over time is crucial. Here's what to consider:

• Historical Performance: Reviewing past financial statements to identify patterns in gross, operating, and net profit margins can provide insights into the company's ability to manage costs and generate revenue.
• Future Projections: Analyzing management's forecasts and analyst estimates for future profitability can offer a perspective on expected financial performance.

Comparing Soleno Therapeutics, Inc. (SLNO)'s profitability ratios with industry averages can provide a benchmark for performance evaluation. This involves:

• Peer Analysis: Comparing gross margin, operating margin, and net profit margin with those of similar-sized biotechnology companies can highlight areas of strength and weakness.
• Industry Benchmarks: Comparing profitability ratios against industry averages to determine if the company is performing above or below the norm.

Operational efficiency is a critical factor that impacts profitability. Key areas to examine include:

• Cost Management: Assessing the company's ability to control costs related to R&D, manufacturing, and administrative functions.
• Gross Margin Trends: Analyzing gross margin trends to identify improvements or declines in production efficiency.

Given the dynamic nature of the biotechnology industry, profitability can be significantly influenced by clinical trial outcomes, regulatory approvals, and market acceptance of new drugs. Monitoring these factors is essential for a comprehensive understanding of Soleno Therapeutics, Inc. (SLNO)'s financial health.

Keep up with Soleno Therapeutics, Inc. (SLNO) on the Mission Statement, Vision, & Core Values of Soleno Therapeutics, Inc. (SLNO).

Soleno Therapeutics, Inc. (SLNO) Debt vs. Equity Structure

Understanding how Soleno Therapeutics, Inc. (SLNO) finances its growth involves analyzing its debt and equity structure. This reveals insights into the company's financial strategy and risk profile. Here’s a breakdown of key aspects:

An overview of Soleno Therapeutics, Inc. (SLNO)'s debt levels (long-term and short-term debt):

As of December 31, 2023, Soleno Therapeutics, Inc. (SLNO) reported a mix of debt obligations. The company's financial statements provide a detailed breakdown:

• Short-term debt: This includes obligations due within one year.
• Long-term debt: This consists of debt obligations due beyond one year.

Soleno Therapeutics, Inc. (SLNO) reported total current liabilities of $3.578 million and total liabilities of $5.797 million as of December 31, 2023.

Debt-to-equity ratio and comparison to industry standards:

The debt-to-equity ratio is a critical metric to assess a company's financial leverage. It indicates the proportion of debt and equity used to finance the company's assets. As of December 31, 2023, Soleno Therapeutics, Inc. (SLNO.)'s debt-to-equity ratio can be derived from the balance sheet:

• Total Liabilities: $5.797 million
• Total Stockholders' Equity: $37.976 million

The debt-to-equity ratio is calculated as Total Liabilities / Total Stockholders' Equity. For Soleno Therapeutics, Inc. (SLNO), this ratio is approximately 0.15 as of December 31, 2023.

Recent debt issuances, credit ratings, or refinancing activity:

Details on recent debt issuances, credit ratings, or refinancing activities provide insights into Soleno Therapeutics, Inc. (SLNO)'s strategies for managing its debt. Recent activities include:

• March 2024 Financing: In March 2024, Soleno Therapeutics, Inc. (SLNO) announced a $25 million financing, which included the issuance of shares and warrants.

How the company balances between debt financing and equity funding:

Soleno Therapeutics, Inc. (SLNO) strategically balances debt and equity to fund its operations and growth. The approach involves:

• Equity Funding: Issuing new shares to raise capital without increasing debt.
• Debt Financing: Utilizing loans and other debt instruments to finance specific projects or operations.

The balance between debt and equity is evident in Soleno Therapeutics, Inc. (SLNO)'s financials. As of December 31, 2023, the company’s total stockholders' equity stood at $37.976 million, significantly higher than its total liabilities of $5.797 million. This indicates a preference for equity funding, providing a stable financial base for ongoing research and development activities.

For more detailed insights, check out: Breaking Down Soleno Therapeutics, Inc. (SLNO) Financial Health: Key Insights for Investors

Soleno Therapeutics, Inc. (SLNO) Liquidity and Solvency

Liquidity and solvency are crucial indicators of a company's financial health, revealing its ability to meet short-term obligations and sustain long-term operations. For investors in Soleno Therapeutics, Inc. (SLNO), these metrics offer insights into the company's stability and risk profile.

Assessing Soleno Therapeutics, Inc.'s Liquidity:

Liquidity ratios, such as the current and quick ratios, provide a snapshot of Soleno Therapeutics, Inc.'s ability to cover its short-term liabilities with its short-term assets. These ratios are vital for understanding the company's immediate financial health.

• Current Ratio: The current ratio is calculated by dividing current assets by current liabilities. A current ratio of greater than 1 indicates that a company has more current assets than current liabilities, suggesting it is well-positioned to meet its short-term obligations.
• Quick Ratio: The quick ratio, also known as the acid-test ratio, is a more conservative measure of liquidity than the current ratio. It excludes inventories from current assets, as inventories may not be easily converted into cash. A quick ratio of 1 or greater is generally considered healthy.

Working Capital Trends:

Analyzing trends in working capital—the difference between current assets and current liabilities—helps investors understand how Soleno Therapeutics, Inc.'s short-term financial health is evolving. A positive and increasing working capital balance typically indicates improving liquidity, while a negative or decreasing balance may signal potential liquidity issues. Monitoring these trends over time provides valuable insights into the company's operational efficiency and financial management.

Cash Flow Statements Overview:

An examination of Soleno Therapeutics, Inc.'s cash flow statements provides a comprehensive view of the company's liquidity. The cash flow statement is divided into three main sections:

• Operating Cash Flow: This section reflects the cash generated or used by the company's core business activities. Positive operating cash flow indicates that the company is generating enough cash from its operations to sustain and grow its business.
• Investing Cash Flow: This section includes cash flows related to the purchase and sale of long-term assets, such as property, plant, and equipment (PP&E). Negative investing cash flow typically indicates that the company is investing in its future growth.
• Financing Cash Flow: This section involves cash flows related to debt, equity, and dividends. Positive financing cash flow may indicate that the company is raising capital, while negative financing cash flow may suggest that the company is paying down debt or returning capital to shareholders.

By analyzing these three components, investors can gain a deeper understanding of Soleno Therapeutics, Inc.'s cash flow dynamics and its overall liquidity position.

Potential Liquidity Concerns or Strengths:

Based on the available financial data, investors should be aware of any potential liquidity concerns or strengths that may impact Soleno Therapeutics, Inc.'s financial stability. Factors to consider include:

• Cash Burn Rate: The rate at which the company is spending its cash reserves. A high cash burn rate may indicate that the company needs to raise additional capital in the near future.
• Debt Levels: The amount of debt the company has outstanding. High debt levels can strain liquidity and increase the risk of financial distress.
• Access to Capital: The company's ability to raise capital through debt or equity offerings. Strong access to capital can provide a buffer against liquidity challenges.

Currently, Soleno Therapeutics, Inc. (SLNO) is focusing on advancing its lead candidate, Diazoxide Choline Extended-Release (DCCR) for Prader-Willi Syndrome (PWS). According to the 10-K filing for the fiscal year ended December 31, 2023, the company's financial status is as follows:

As of December 31, 2023, Soleno Therapeutics reported total cash, cash equivalents, and marketable securities of approximately $51.8 million. The company anticipates that its existing cash, cash equivalents, and marketable securities will be sufficient to fund operations into the second quarter of 2025.

For more insights into investor behavior and stock performance, check out: Exploring Soleno Therapeutics, Inc. (SLNO) Investor Profile: Who’s Buying and Why?

Soleno Therapeutics, Inc. (SLNO) Valuation Analysis

Determining whether Soleno Therapeutics, Inc. (SLNO) is overvalued or undervalued requires a multifaceted approach, integrating various financial metrics and market analyses. Key valuation indicators include price-to-earnings (P/E), price-to-book (P/B), and enterprise value-to-EBITDA (EV/EBITDA) ratios, alongside stock price trends, dividend information (if applicable), and analyst consensus.

Currently, Soleno Therapeutics does not have a P/E ratio because the company has no earnings. For companies without positive earnings, alternative valuation methods are often employed, such as price-to-sales ratio or assessing the potential of their pipeline products.

As of April 2025, Soleno Therapeutics' stock demonstrates the following trends:

• Stock Price: On April 18, 2025, SLNO was trading at $44.49.
• 52-Week Range: The stock has fluctuated between $1.76 and $54.99 over the past year, indicating significant volatility.

Here's a snapshot of SLNO's key stock data:

Soleno Therapeutics does not currently offer a dividend yield, which is common for growth-oriented biotech companies that typically reinvest earnings into research and development.

Analyst consensus on Soleno Therapeutics' stock valuation varies. The consensus estimate points to a potential upside, with a 1-year target estimate of $90.00. Investors should consider these estimates alongside their own due diligence.

To gain more insight into who is investing in SLNO and why, check out: Exploring Soleno Therapeutics, Inc. (SLNO) Investor Profile: Who’s Buying and Why?

Soleno Therapeutics, Inc. (SLNO) Risk Factors

Soleno Therapeutics, Inc. (SLNO) faces a variety of risks that could significantly impact its financial health. These risks span internal operational challenges and external market dynamics, requiring careful monitoring and proactive mitigation strategies.

Here's a breakdown of key risk areas:

• Industry Competition: The biotechnology industry is intensely competitive. Soleno faces competition from established pharmaceutical companies and other biotech firms, some of which have greater financial and technical resources. Successful products, patents, and strategic alliances of competitors could limit Soleno's market opportunities.
• Regulatory Changes: The development, manufacturing, and marketing of pharmaceutical products are subject to extensive regulation by governmental authorities in the United States and other countries. Changes in regulatory requirements or delays in obtaining regulatory approvals can significantly delay or increase the costs of Soleno's product development programs.
• Market Conditions: Unfavorable economic conditions, healthcare reforms, or changes in reimbursement policies by third-party payers could negatively affect the demand for Soleno's products and its ability to achieve profitability.

Specific risks highlighted in recent earnings reports or filings may include:

• Operational Risks: These encompass challenges related to clinical trial execution, manufacturing scalability, and supply chain management. Delays or failures in these areas can lead to increased costs and delayed product launches.
• Financial Risks: Soleno may face risks related to its ability to secure additional funding to support ongoing research and development activities. Changes in interest rates, currency exchange rates, or the availability of capital could impact its financial performance.
• Strategic Risks: Strategic risks involve decisions related to product development prioritization, market entry strategies, and partnerships. Poor strategic decisions can lead to wasted resources and missed opportunities.

Mitigation strategies or plans that Soleno Therapeutics, Inc. (SLNO) may employ to address these risks include:

• Diversification of Product Pipeline: Developing a diverse portfolio of product candidates can reduce the company's reliance on a single product and mitigate the impact of potential setbacks in one area.
• Strategic Partnerships: Collaborating with other companies or research institutions can provide access to additional resources, expertise, and funding.
• Risk Management Programs: Implementing robust risk management programs can help identify, assess, and mitigate potential risks across the organization.

For further insights into Soleno Therapeutics, Inc. (SLNO), explore: Mission Statement, Vision, & Core Values of Soleno Therapeutics, Inc. (SLNO).

Soleno Therapeutics, Inc. (SLNO) Growth Opportunities

Soleno Therapeutics, Inc. (SLNO) is focused on the development and commercialization of novel therapeutics for the treatment of rare diseases. Understanding the company's growth prospects involves analyzing its key drivers, financial projections, strategic initiatives, and competitive advantages. Here’s an overview of potential future growth areas:

Key Growth Drivers:

• Product Innovations: Soleno Therapeutics' primary focus is on developing and commercializing Diazoxide Choline (DCCR) for Prader-Willi Syndrome (PWS). Successful clinical trials and regulatory approvals are critical for driving growth.
• Market Expansion: Expanding the market for DCCR beyond PWS to other related metabolic disorders could significantly increase revenue potential.
• Acquisitions and Partnerships: Strategic acquisitions of or partnerships with other companies that have complementary technologies or products could broaden Soleno Therapeutics' pipeline and market reach.

Future Revenue Growth Projections and Earnings Estimates:

As a clinical-stage biopharmaceutical company, Soleno Therapeutics' future revenue is heavily dependent on the successful commercialization of its lead product candidate, DCCR. Here's what impacts those projections:

Based on analyses and projections:

Here’s a look at revenue estimates and key considerations:

• Revenue Estimates: Revenue is projected to increase significantly, reaching $18.28 million in 2024, $64.85 million in 2025, and $163.67 million in 2026.
• Net Income Estimates: Net income is expected to improve from a loss of $49.74 million in 2024 to a profit of $12.15 million in 2026.

Strategic Initiatives and Partnerships:

Soleno Therapeutics' growth could be significantly influenced by strategic initiatives and partnerships, including:

• Regulatory Milestones: Achieving regulatory approval for DCCR in major markets (e.g., the United States and Europe) is crucial.
• Commercialization Strategy: A well-executed commercialization strategy, including pricing, distribution, and marketing, will be essential for maximizing revenue.
• Partnerships: Collaborating with other pharmaceutical companies for development or commercialization could accelerate growth and reduce financial risk.

Competitive Advantages:

Soleno Therapeutics faces competition from other companies developing treatments for rare diseases. Its competitive advantages include:

• Orphan Drug Designation: DCCR has received orphan drug designation, which provides market exclusivity and other benefits.
• Clinical Data: Positive clinical trial results demonstrating the efficacy and safety of DCCR are a significant advantage.
• Intellectual Property: Strong patent protection for DCCR and related technologies can provide a competitive edge.

Here’s a detailed table summarizing key financial projections and estimates:

For more detailed insights, you can read the full analysis here: Breaking Down Soleno Therapeutics, Inc. (SLNO) Financial Health: Key Insights for Investors