Geron Corporation (NASDAQ:GERN) is not generating sufficient returns to cover its cost of capital, with a ROIC of -26.79% compared to its WACC of 8.50%.
Stem, Inc. faces significant challenges in its investment strategies and operations, indicated by a ROIC of -85.39% and a WACC of 4.80%.
Agenus Inc. showcases high efficiency in capital use, with a ROIC of 1245.27% and a WACC of 76.38%, suggesting strong growth potential.
Geron Corporation (NASDAQ:GERN) is a biopharmaceutical company focused on developing and commercializing innovative therapeutics for cancer treatment. The company’s primary product candidate is imetelstat, a telomerase inhibitor, which is in clinical trials for hematologic myeloid malignancies. Geron operates in a competitive landscape with peers like Stem, Inc., Agenus Inc., and Exelixis, Inc., each with varying degrees of investment efficiency and growth potential.
Geron Corporation’s ROIC of -26.79% compared to its WACC of 8.50% indicates that the company is not generating sufficient returns to cover its cost of capital. This negative ROIC suggests inefficiencies in capital investments or operational challenges. The ROIC to WACC ratio of -3.15 further highlights the company’s struggle to achieve profitable returns on its investments.
In comparison, Stem, Inc. exhibits an even more concerning financial position with a ROIC of -85.39% and a WACC of 4.80%. The ROIC to WACC ratio of -17.80 underscores significant inefficiencies in generating returns, suggesting that Stem, Inc. faces substantial challenges in its investment strategies and operations.
On the other hand, Agenus Inc. presents a stark contrast with a ROIC of 1245.27% and a WACC of 76.38%. The ROIC to WACC ratio of 16.30 indicates that Agenus Inc. is highly efficient in its capital use, generating substantial returns well above its cost of capital. This positions Agenus as a potentially attractive investment opportunity due to its strong growth potential.
Exelixis, Inc. also demonstrates efficient capital use with a ROIC of 24.00% and a WACC of 5.18%. The ROIC to WACC ratio of 4.63 suggests that Exelixis is effectively generating returns above its cost of capital, indicating a strong ability to manage investments and operations efficiently.
