MannKind Corporation (NASDAQ:MNKD) showcases a positive Return on Invested Capital (ROIC) to Weighted Average Cost of Capital (WACC) ratio, indicating efficient capital utilization.
Competitors like ACADIA Pharmaceuticals and Exelixis also demonstrate positive capital efficiency, with ACADIA leading in ROIC to WACC ratio.
Geron Corporation and Celldex Therapeutics show negative ROIC to WACC ratios, highlighting challenges in generating sufficient returns to cover their cost of capital.
MannKind Corporation (NASDAQ:MNKD) is a biopharmaceutical company known for its innovative drug delivery systems, particularly in the field of diabetes treatment. The company focuses on developing and commercializing therapeutic products for patients with diseases such as diabetes and pulmonary arterial hypertension. In the competitive landscape, MannKind’s peers include companies like Geron Corporation, Celldex Therapeutics, ACADIA Pharmaceuticals, Amarin Corporation, and Exelixis, each with varying degrees of capital efficiency.
MannKind’s Return on Invested Capital (ROIC) is 20.47%, while its Weighted Average Cost of Capital (WACC) is 12.08%. This results in a ROIC to WACC ratio of 1.69, indicating that MannKind is generating returns above its cost of capital. This is a positive indicator for investors, as it suggests that the company is effectively using its capital to generate value.
In comparison, Geron Corporation has a negative ROIC of -34.35% and a WACC of 8.06%, resulting in a ROIC to WACC ratio of -4.26. This negative ratio indicates that Geron is not generating sufficient returns to cover its cost of capital, which could be a concern for investors. Similarly, Celldex Therapeutics has a ROIC of -25.98% and a WACC of 12.28%, leading to a ROIC to WACC ratio of -2.12, also reflecting inefficiency in capital utilization.
On the other hand, ACADIA Pharmaceuticals stands out with a ROIC of 25.22% and a WACC of 5.98%, resulting in the highest ROIC to WACC ratio of 4.22 among the peers. This suggests that ACADIA is generating significantly higher returns on its invested capital compared to its cost of capital, making it the most efficient in capital utilization among its peers.
Exelixis also shows a positive ROIC to WACC ratio of 2.74, with a ROIC of 18.19% and a WACC of 6.65%. This indicates that Exelixis, like MannKind, is generating returns above its cost of capital, though not as high as ACADIA. Meanwhile, Amarin Corporation has a negative ROIC to WACC ratio of -1.57, with a ROIC of -19.33% and a WACC of 12.29%, indicating inefficiency in capital utilization.
