A strong performer from today's afternoon trading session is Natera, whose shares rose 1.4% to $92.7 per share. For those of you thinking about investing in the stock, here is a brief value analysis of the stock using the company's basic fundamental ratios.
Natera Has Elevated P/B and P/E Ratios:
Natera, Inc., a diagnostics company, develops and commercializes molecular testing services worldwide. The company belongs to the Health Care sector, which has an average price to earnings (P/E) ratio of 30.21 and an average price to book (P/B) ratio of 4.08. In contrast, Natera has a trailing 12 month P/E ratio of -24.5 and a P/B ratio of 14.48.
Natera has moved 68.5% over the last year compared to 27.4% for the S&P 500 — a difference of 41.1%. Natera has a 52 week high of $96.24 and a 52 week low of $36.9.
Healthy Debt Levels but a Declining EPS Growth Trend:
| 2018 | 2019 | 2020 | 2021 | 2022 | 2023 | |
|---|---|---|---|---|---|---|
| Revenue (k) | $257,654 | $302,328 | $391,005 | $625,486 | $820,222 | $1,082,571 |
| Operating Margins | -44% | -38% | -55% | -75% | -66% | -41% |
| Net Margins | -50% | -41% | -59% | -75% | -67% | -40% |
| Net Income (k) | -$128,154 | -$124,827 | -$229,743 | -$471,716 | -$547,799 | -$434,801 |
| Net Interest Expense (k) | -$2,729 | $4,152 | $7,562 | $5,381 | $3,538 | $24,353 |
| Depreciation & Amort. (k) | $1,300 | $7,730 | $8,613 | $11,300 | $16,700 | $22,700 |
| Diluted Shares (k) | 57,848 | 69,555 | 81,011 | 90,558 | 98,408 | 114,997 |
| Earnings Per Share | -$2.22 | -$1.79 | -$2.84 | -$5.21 | -$5.57 | -$3.78 |
| EPS Growth | n/a | 19.37% | -58.66% | -83.45% | -6.91% | 32.14% |
| Avg. Price | $16.13 | $26.18 | $53.7 | $107.57 | $48.18 | $92.8 |
| P/E Ratio | -6.81 | -13.16 | -18.27 | -19.74 | -8.39 | -24.17 |
| CAPEX (k) | $12 | $4,968 | $19,604 | $41,030 | $47,697 | $39,199 |
| EV / EBITDA | -8.38 | -15.71 | -21.22 | -20.92 | -8.57 | -24.16 |
| Total Debt (k) | $123,510 | $123,779 | $252,547 | $330,446 | $362,003 | $363,347 |
| Current Ratio | 2.11 | 2.91 | 4.33 | 4.99 | 3.9 | 4.1 |
Natera has rapidly growing revenues and increasing reinvestment in the business, an excellent current ratio of 4.1, and healthy debt levels. However, the firm suffers from weak operating margins with a stable trend and declining EPS growth.
