Harrow Health, Inc.

HROW

Pharmaceutical Preparations

Mkt Cap

$656.7M

PE

-20.96

Debt

$243.4M

Cash

$68.54M

EV

$831.6M

FCF

$6.37M

Market Cap

$656.7M

P/E Ratio

-20.96

Debt

$243.4M

Cash

$68.54M

EV

$831.6M

FCF

$6.37M

Charts data: {"Earnings":[{"time":"2014-12-30","value":-10118103},{"time":"2015-12-30","value":-15899000},{"time":"2016-12-30","value":-19087000},{"time":"2017-12-30","value":-11985000},{"time":"2018-12-30","value":14625000},{"time":"2019-12-30","value":-125000},{"time":"2020-12-30","value":-3419000},{"time":"2021-12-30","value":-18479000},{"time":"2022-12-30","value":-14086000},{"time":"2023-12-30","value":-24411000}],"Sales":[{"time":"2014-12-30","value":1660246},{"time":"2015-12-30","value":9716000},{"time":"2016-12-30","value":19942000},{"time":"2017-12-30","value":26774000},{"time":"2018-12-30","value":41372000},{"time":"2019-12-30","value":51165000},{"time":"2020-12-30","value":48871000},{"time":"2021-12-30","value":72476000},{"time":"2022-12-30","value":88595000},{"time":"2023-12-30","value":130193000}],"Net Margins":[{"time":"2014-12-30","value":-6.094339634006045},{"time":"2015-12-30","value":-1.6363729930012352},{"time":"2016-12-30","value":-0.9571256644268378},{"time":"2017-12-30","value":-0.4476357660416822},{"time":"2018-12-30","value":0.35349995165812625},{"time":"2019-12-30","value":-0.00244307632170429},{"time":"2020-12-30","value":-0.0699596897955843},{"time":"2021-12-30","value":-0.25496716154313154},{"time":"2022-12-30","value":-0.15899317117218806},{"time":"2023-12-30","value":-0.18749855983040564}],"Assets":[{"time":"2014-12-30","value":10242224},{"time":"2015-12-30","value":14131000},{"time":"2016-12-30","value":27247000},{"time":"2017-12-30","value":23917000},{"time":"2018-12-30","value":49451000},{"time":"2019-12-30","value":59085000},{"time":"2020-12-30","value":57474000},{"time":"2021-12-30","value":98329000},{"time":"2022-12-30","value":157378000},{"time":"2023-12-30","value":312164000}],"Stockholders Equity":[{"time":"2014-12-30","value":8150174},{"time":"2015-12-30","value":-1385000},{"time":"2016-12-30","value":6432000},{"time":"2017-12-30","value":2615000},{"time":"2018-12-30","value":24751000},{"time":"2019-12-30","value":27711000},{"time":"2020-12-30","value":27183000},{"time":"2021-12-30","value":11286000},{"time":"2022-12-30","value":27595000},{"time":"2023-12-30","value":70766000}],"ROE":[{"time":"2014-12-30","value":-1.241458525916134},{"time":"2015-12-30","value":11.47942238267148},{"time":"2016-12-30","value":-2.9675062189054726},{"time":"2017-12-30","value":-4.583173996175908},{"time":"2018-12-30","value":0.5908852167589188},{"time":"2019-12-30","value":-0.004510844069142218},{"time":"2020-12-30","value":-0.1257771401243424},{"time":"2021-12-30","value":-1.637338295233032},{"time":"2022-12-30","value":-0.5104547925348795},{"time":"2023-12-30","value":-0.3449537913687364}],"ROA":[{"time":"2014-12-30","value":-0.9906782940892525},{"time":"2015-12-30","value":-1.0488995824782392},{"time":"2016-12-30","value":-0.5828898594340661},{"time":"2017-12-30","value":-0.5085504034786972},{"time":"2018-12-30","value":0.2957473054134396},{"time":"2019-12-30","value":-0.0021155961750021156},{"time":"2020-12-30","value":0.006698681142777604},{"time":"2021-12-30","value":0.016414282663303807},{"time":"2022-12-30","value":0.012193572163834843},{"time":"2023-12-30","value":0.0013806845119872888}]}

Harrow Health, Inc., an eyecare pharmaceutical company, focuses on the discovery, development, and commercialization of ophthalmic therapies. The company offers ImprimisRx, an ophthalmology outsourcing and pharmaceutical compounded medications. It also provides IHEEZO, a chloroprocaine hydrochloride ophthalmic gel; ophthalmic medicines, including IOPIDINE and MOXEZA; MAXITROL eye drops; ILEVRO and NEVANAC, a non-steroidal and anti-inflammatory eye drop for pain and inflammation associated with cataract surgery; VIGAMOX, a fluoroquinolone antibiotic eye drop for the treatment of bacterial conjunctivitis; MAXIDEX, a steroid eye drop for steroid-responsive inflammatory conditions of the palpebral and bulbar conjunctiva, cornea, and anterior segment of the globe; TRIESENCE, a steroid injection for the treatment of ophthalmic diseases and for visualization during vitrectomy; and MAQ-100, a preservative-free triamcinolone acetonide ophthalmic injection drug candidate. The company was formerly known as Imprimis Pharmaceuticals, Inc. and changed its name to Harrow Health, Inc. in December 2018. Harrow Health, Inc. was founded in 1998 and is headquartered in Nashville, Tennessee.

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12/31/17

DCF

Discounted Cash Flow Valuation of Harrow Health, Inc.

Calculate

Growth Years

Growth

Start

End

Discount

Start

End

Multiple

g\r	+10%	+11%	+12%	+13%	+14%
0%	10	9	8	8	7
+1%	11	10	9	8	8
+2%	13	11	10	9	8
+3%	14	13	11	10	9
+4%	17	14	12	11	10

Years	0	1	2	3	4	5	6	7	8	9	10	TV
FCF	$6.37M	$7.327M	$8.345M	$9.413M	$10.51M	$11.62M	$12.72M	$13.78M	$14.78M	$15.68M	$16.47M	$164.7M
DCF		$6.371M	$6.31M	$6.189M	$6.01M	$5.778M	$5.5M	$5.181M	$4.831M	$4.458M	$4.07M	$40.7M
Value	$95.4M

Chart P/E ratio

In the chart Earnings are multiplied by this value.

Earnings Growth -35%

Earnings Stability -42%

Competitiveness and MOAT

High margins render the company resilient under dire circumstances, hence able to drive competitors out or acquire them. ROE and ROA measure the average flow generated by each invested dollar. Their marginal value is a forecast of future growth, and it is considered by Buffett and Munger the most important single indicator.

The Net Margin is too low to guarantee profitability in case of higher costs or higher interest rates. Furthermore lower margins cause higher earnings’ volatility.

Over time the ROA has been decreasing indicating a lower marginal ROA with respect to the calculated one, this could impede growth.

Years	12-2015	12-2016	12-2017	12-2018	12-2019	12-2020	12-2021	12-2022	12-2023	TTM
Net Margin	-160%	-96%	-45%	35%	-0.24%	-7%	-25%	-16%	-19%	-23%
ROA	-100%	-58%	-51%	30%	-0.21%	0.67%	1.6%	1.2%	0.14%	-2.6%
ROE	1.1K%	-300%	-460%	59%	-0.45%	-13%	-160%	-51%	-34%	-52%

What is the average Net Margin?

The average Net Margin over the past 5 years is -5.34%.

What is the trend of Net Margin?

The trend of Net Margin over the past 5 years is -9.6%.

What is the average Return on Assets (ROA)?

The average ROA over the past 5 years is +5.51%.

What is the trend of Return on Assets (ROA)?

The trend of ROA over the past 5 years is -4.05%.

What is the average Return on Equity (ROE)?

The average ROE over the past 5 years is -33.87%.

What is the trend of Return on Equity (ROE)?

The trend of ROE over the past 5 years is -22.02%.

Safety & Stabiliy

Being debt the number one cause of investment losses and company death, the ratio Debt/FCF is of utmost importance to guarantee safety. On the other hand the Graham’s stability measures the drawdown of earnings, hence indicating the reliability of the flow generated by the company.

The company has high debt with respect to the cashflow it generates.

The Graham’s stability indicate a relevant drawdown, consider checking when it has occured and why.

Years	12-2015	12-2016	12-2017	12-2018	12-2019	12-2020	12-2021	12-2022	12-2023	TTM
Debt FCF	-	-0.92	-2.45	-24.04	-3.42	-11.54	31.26	-170.15	103.66	38.22
Debt Equity	-	0.62	8.97	1.05	0.06	0.83	9.13	5.50	3.49	4.02
MIN
Graham Stability	-	-	-	-	-	-410%	-500%	-	-	-500%

What is the Debt/FCF?

The Debt/FCF trailing twelve month is 38.22.

What is the trend of Debt/FCF?

The trend of Debt/FCF over the past 5 years is 5.18.

What is the Graham’s Stability?

Graham’s Stability measure stands at -5.00.

Growth

Growth can be dangerous when forecasting, simply projecting the current growth is in general wrong. A company passes through multiple phases, from being young and unprofitable, to the first periods of profitability and high growth, until it arrives at a period of regime with limited growth. Identifying in which phase the company is in may help forecasting.

Data are missing

Years	12-2016	12-2018	12-2020	12-2022	Trend
Revenue	31%	26%	39%	47%	-34%
Net Income	-	-	-	-	-
Stockholders Equity	41%	23%	38%	160%	-30%
FCF	-	-	-	-	-

What is the 5 year Revenue CAGR?

The Revenue CAGR over the past 5 years is +25.77%.

What is the trend of Revenue growth?

The trend of Revenue growth rate over the past 5 years is -33.88%.

What is the 5 year Earnings CAGR?

The Earnings CAGR over the past 5 years is -.

What is the trend of Earnings growth?

The trend of Earnings growth rate over the past 5 years is -.

What is the 5 year Equity CAGR?

The Equity CAGR over the past 5 years is +23.38%.

What is the trend of Equity growth?

The trend of Equity growth rate over the past 5 years is -29.54%.

What is the 5 year FCF CAGR?

The FCF CAGR over the past 5 years is -.

What is the trend of FCF growth?

The trend of FCF growth rate over the past 5 years is -.