Equillium (EQ) AI Stock Analysis

• Market Cap: $14.44M
• Dividend Yield: N/A
• Average Volume (3M): 124.52K
• Price to Earnings (P/E): ―
• Beta (1Y): 1.31
• Revenue Growth: 13.89%
• EPS Growth: 40.73%
• Country: US
• Employees: 45
• Sector: Healthcare
• Sector Strength: 71
• Industry: Biotechnology
• EPS (TTM): -0.23
• Shares Outstanding: 35,609,905
• 10 Day Avg. Volume: 212,828
• 30 Day Avg. Volume: 124,519
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): 0.60
• Price to Cash Flow (P/CF): -0.90
• P/FCF Ratio: 0.00
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: $1.00
• Price Target Upside: 150.00% Upside
• Rating Consensus: Hold
• Number of Analyst Covering: 1

Equillium's overall stock score reflects its current challenges. Despite strong revenue growth, the company struggles with profitability and operational cash flow issues. The technical analysis indicates a bearish trend, and the valuation metrics highlight the company's unprofitable nature. These factors combine to present a high-risk investment profile.

Positive Factors

Clinical Trial Success

EQ reported positive topline results from a Phase 2 study of lead asset itolizumab in ulcerative colitis, demonstrating encouraging activity and being well tolerated with no notable safety signals.

Strategic Focus

EQ will retain development and commercial rights for itolizumab in the US/Canada/Australia/New Zealand regions and will prioritize itolizumab as their lead asset with two key data readouts expected.

Valuation Potential

The modest valuation for EQ at current levels, combined with positive data, successful regulatory interaction, and additional capital, could drive meaningful upside to EQ shares.

Negative Factors

Clinical Trial Results

EQ reported disappointing topline results from the Phase 3 EQUATOR study of lead asset itolizumab in front-line acute Graft-versus-Host Disease.

Financial Concerns

A financing solution remains a significant near-term overhang for EQ shares.

Regulatory Challenges

There remains significant uncertainty regarding FDA's willingness to accept these results for the basis of an accelerated approval.

Equillium Business Overview & Revenue Model

Company Description

Equillium, Inc. is a clinical-stage biotechnology company focused on developing innovative therapeutics to treat severe autoimmune and inflammatory disorders. The company's primary therapeutic approach is centered around the modulation of the immune system, with its lead product candidate, itolizumab, being developed for multiple indications, including acute graft-versus-host disease (aGVHD) and other autoimmune conditions. Equillium operates in the biotechnology sector, leveraging its expertise in immunology to address unmet medical needs.

How the Company Makes Money

Equillium generates revenue primarily through strategic collaborations, partnerships, and potential licensing agreements. The company focuses on advancing its clinical-stage product candidates towards regulatory approval and commercialization, which could lead to milestone payments and royalties from partners. Equillium's revenue model is heavily reliant on the successful development and commercialization of its lead asset, itolizumab, and securing strategic alliances with larger pharmaceutical companies to support its pipeline and financial sustainability.

Equillium Financial Statement Overview

Summary

Equillium shows positive revenue growth but continues to operate at a net loss, negatively impacting profitability margins. While the balance sheet is strong with low leverage, negative cash flow remains a significant risk.

Income Statement

Equillium has shown positive revenue growth with a significant increase from 2022 to TTM (Trailing-Twelve-Months). However, the company is still operating at a net loss, affecting its net profit margin negatively. The negative EBIT and EBITDA margins indicate operating inefficiencies and ongoing profitability challenges.

Balance Sheet

The company maintains a strong equity position with a relatively low debt-to-equity ratio, indicating financial stability. The equity ratio suggests a healthy proportion of equity financing. However, the return on equity remains negative due to net losses, which is a key area of concern.

Cash Flow

The cash flow statement indicates negative free cash flow, which has grown slightly less negative, reflecting a potential improvement in cash management. The negative operating cash flow to net income ratio suggests cash flow issues relative to earnings. These factors highlight the need for better cash management strategies.

Breakdown
TTM	Dec 2023	Dec 2022	Dec 2021	Dec 2020	Dec 2019
Income Statement		Total Revenue
45.91M	36.08M	15.76M	0.00	0.00	0.00
	Gross Profit
45.81M	35.96M	15.64M	-72.00K	-45.00K	-23.00K
	EBIT
-6.77M	-14.52M	-62.08M	-37.79M	-29.55M	-26.73M
	EBITDA
-5.17M	-12.14M	-61.26M	-37.91M	-28.67M	-25.30M
	Net Income Common Stockholders
-4.62M	-13.34M	-107.71M	-38.98M	-29.77M	-25.58M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
61.99M	40.87M	71.02M	80.71M	82.16M	53.14M
	Total Assets
71.79M	50.53M	78.42M	85.41M	85.43M	55.54M
	Total Debt
8.68M	824.00K	10.19M	9.98M	8.28M	9.68M
	Net Debt
-15.82M	-22.39M	-48.92M	-40.38M	-15.71M	-3.54M
	Total Liabilities
42.52M	27.96M	46.48M	18.90M	15.57M	13.69M
	Stockholders Equity
29.27M	22.57M	31.94M	66.50M	69.85M	41.85M
Cash Flow		Free Cash Flow
-21.51M	-21.83M	-9.01M	-32.14M	-24.83M	-23.02M
	Operating Cash Flow
-21.39M	-21.78M	-8.73M	-32.08M	-24.62M	-22.95M
	Investing Cash Flow
2.25M	-4.76M	18.68M	27.41M	-18.59M	-2.17M
	Financing Cash Flow
170.00K	-9.23M	-1.22M	31.06M	53.95M	9.84M

Equillium Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 0.40
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Positive
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For EQ, the sentiment is Negative. The current price of 0.4 is below the 20-day moving average (MA) of 0.74, below the 50-day MA of 0.75, and below the 200-day MA of 0.80, indicating a bearish trend. The MACD of -0.05 indicates Positive momentum. The RSI at 23.70 is Positive, neither overbought nor oversold. The STOCH value of 20.77 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for EQ.

Equillium Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
BMRN	78 Outperform	$13.63B	32.48	8.05%	―	17.35%	151.40%
VRTX	64 Neutral	$126.52B	―	-3.15%	―	11.64%	-114.72%
FOLD	61 Neutral	$2.59B	―	-31.68%	―	32.29%	64.39%
RARE	54 Neutral	$3.50B	―	-214.50%	―	29.01%	23.93%
Sector *	49 Neutral	$6.85B	0.81	-52.91%	2.50%	19.94%	1.20%
ARWR	47 Neutral	$1.90B	―	-600.68%	―	-98.62%	-86.21%
EQ	35 Underperform	$14.44M	―	-38.75%	―	13.89%	40.73%

Equillium Corporate Events

Equillium Announces Board and Audit Committee Changes

Equillium, Inc. announced changes in its Board of Directors with the resignation of Yu (Katherine) Xu, Ph.D., from the Board and Audit Committee, and the appointment of Barbara Troupin, M.D., to the Audit Committee. Additionally, Peter Colabuono was appointed as a Class II director with a term until 2026, receiving an annual cash retainer and stock options under the company’s Non-Employee Director Compensation Policy.