Zai Lab Ltd

Health Care
Biotechnology: Pharmaceutical Preparations
www.zailaboratory.com

Moat Score
Safety Score

Market Cap $27.33B
PE -101
Debt $112.99M
Cash $616.09M
EV $26.82B
FCF -$177.30M

Earnings

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Sales & Net Margins

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Earnings	-$270.85M
EBIT	-$270.85M
ROE	-41%
ROA	-27%
FCF	-$177.30M
Equity	$667.67M
Growth Stability	1
PE	-100.89
PB	40.93
P/FCF	-154.12
P/S	76.81
Price/Cash	0.02
Debt/Equity	0.17
Debt/FCF	-0.64
Net Margins	-61%
Gross Margins	63%
Op. Margins	-76%
Sales Growth YoY	48%
Sales Growth QoQ	2%
Sales CAGR	66%
Equity CAGR	21%
Earnings Growth YoY	-40%

Earnings Growth QoQ	-48%
Sales CAGR 5Y	80%
Equity CAGR 5Y	4%
Earnings CAGR 3Y	34%
Sales CAGR 3Y	34%
Equity CAGR 3Y	-23%
Market Cap	$27.33B
Revenue	$355.75M
Assets	$985.35M
Total Debt	$112.99M
Cash	$616.09M
Shares Outstanding	976.94M
EV	26.82B
Moat Score	2%
Safety Score	65%
Working Capital	574.23M
Current Ratio	3.01
Gross Profit	$225.18M
Shares Growth 3y	1%
Equity Growth QoQ	-5%
Equity Growth YoY	-24%

Assets & ROA

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Stockholders Equity & ROE

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Zai Lab Ltd is a biopharmaceutical company focusing on discovering or licensing, developing and commercializing proprietary therapeutics that address areas of unmet medical need including in the fields of oncology, autoimmune and infectious diseases. The pipeline of proprietary drug candidates of the company includes ZL-2306 for treatment across multiple solid tumor types including ovarian and certain types of breast and lung cancers; ZL-2401 which is an antibiotic in a new class of tetracycline derivatives; and ZL-2301 is an oral, small molecule which targets HCC. The other product candidate includes Fugan, ZL-2302, and ZL-1101.

SEC Filings

Direct access to Zai Lab Ltd (ZLAB) Annual Reports (10K) and Quarterly Reports (10Q) from the SEC website.

2024
- 10-Q Sep 30
- 10-Q Jun 30
- 10-Q Mar 31
2023
- 10-K Dec 31
- 10-Q Sep 30
- 10-Q Jun 30
- 10-Q Mar 31
2022
- 10-K Dec 31
- 10-Q Sep 30
- 10-Q Jun 30
- 10-Q Mar 31

Sector Comparison

How does Zai Lab Ltd compare to its competitors?

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Peter Lynch's Chart

This chart shows the current pricing of Zai Lab Ltd compared to its past. The addition of the earnings trend line provides further insights into the company's earnings power.

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Zai Lab Ltd Discounted Cash Flow

Fully customizable DCF calculator online for Zai Lab Ltd.

Years

Calculation mode

= -$1.8B

	0	1	2	3	4	5	6	7	8	9	10	TV
fcf	-$177M	-$177M	-$177M	-$177M	-$177M	-$177M	-$177M	-$177M	-$177M	-$177M	-$177M	-$1.8B
DCF		-$161M	-$147M	-$133M	-$121M	-$110M	-$100M	-$91M	-$83M	-$75M	-$68M	-$684M
Value	-$1.8B

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.

Years	12/2015	12/2016	12/2017	12/2018	12/2019	12/2020	12/2021	12/2022	12/2023	TTM
Net Margins	-	-	-	-107K%	-2K%	-549%	-488%	-206%	-125%	-61%
ROA	-	-	-	-46%	-55%	-21%	-43%	-33%	-32%	-27%
ROE	-	-	-	-55%	-66%	-23%	-51%	-42%	-42%	-41%

Bad Net Margins (-60.51%)

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

Safety and Stability

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.

Years	12/2015	12/2016	12/2017	12/2018	12/2019	12/2020	12/2021	12/2022	12/2023	TTM
Debt over FCF	-	-	-	-0.03	-0.03	-	-	-	-0	-0.64
Debt over Equity	-	-	-	0.01	0.02	-	-	-	0	0.17
Growth Stability	-	-	-	-	-	-	-	-	-	1

Good Debt/FCF ratio (-0.64)

Net Margins are high enough to offer a good protection on the profits in case of higher costs or higher interests. Furthermore higher margins reduce earnings’ volatility.

Good Debt/Equity ratio (0.17)

The company is not overleveraged and has a good balance between equity and debt.

Good Graham’s Stability (1)

The company has a good stability in its earnings, which is a sign of a good competitive advantage.

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.

Years	12/2015	12/2016	12/2017	12/2018	12/2019	12/2020	12/2021	12/2022	12/2023	CAGR 5Y
Revenue YoY growth	-	-	-	-	10K%	277%	195%	49%	24%	80%
Earnings YoY growth	-	108%	34%	176%	40%	38%	162%	-37%	-25%	-
Equity YoY growth	-	181%	-556%	7%	17%	297%	18%	-24%	-24%	4%
FCF YoY growth	-	182%	21%	159%	83%	15%	151%	-31%	-48%	-