Intrinsic value of Syndax Pharmaceuticals - SNDX

Previous Close

$4.92

  Intrinsic Value

$1.06

stock screener

  Rating & Target

str. sell

-79%

Previous close

$4.92

 
Intrinsic value

$1.06

 
Up/down potential

-79%

 
Rating

str. sell

We calculate the intrinsic value of SNDX stock by summing up the current values of future distributable cash flows generated by the company and dividing the sum by the number of outstanding shares. As such, the intrinsic value calculation depends entirely on projections. The more accurate your projections of the company's performance are - the more reliable is the intrinsic value calculation result. Please make sure to check the stock valuation input data below and adjust it if necessary. The quality of the output (intrinsic valuation result) is only as good as the quality of the input. See also DISCLAIMERS.

STOCK VALUATION INPUT DATA

Revenue (in 0001), $M
Initial revenue growth rate, %
Terminal revenue growth rate, %
Revenue decline factor
Initial discount rate, %
Discount rate multiplier
Variable cost ratio, %
Fixed operating expenses, $M
Interest rate on debt, %
Effective corporate tax rate, %
Production assets / Revenue, %
Life of production assets, yrs
Working capital / Revenue, %
Revenue / Adjusted assets
Adjusted equity ratio
Cash flow adjustment, % of Revenue
Book value of equity, $M
Shares outstanding, mln
Market capitalization, $bln 0.1

 

FINANCIAL STATEMENTS FORECAST and PRESENT VALUE CALCULATION

Fiscal year
   2
   3
   4
   5
   6
   7
   8
   9
   10
   11
   12
   13
   14
   15
   16
   17
   18
   19
   20
   21
   22
   23
   24
   25
   26
   27
   28
   29
   30
   31

INCOME STATEMENT

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Revenue growth rate, %
  24.30
  22.37
  20.63
  19.07
  17.66
  16.40
  15.26
  14.23
  13.31
  12.48
  11.73
  11.06
  10.45
  9.91
  9.42
  8.97
  8.58
  8.22
  7.90
  7.61
  7.35
  7.11
  6.90
  6.71
  6.54
  6.39
  6.25
  6.12
  6.01
  5.91
Revenue, $m
  3
  3
  4
  5
  5
  6
  7
  8
  9
  11
  12
  13
  15
  16
  17
  19
  21
  22
  24
  26
  28
  30
  32
  34
  36
  39
  41
  43
  46
  49
Variable operating expenses, $m
  64
  79
  95
  113
  133
  155
  178
  203
  231
  259
  290
  322
  355
  391
  427
  466
  506
  547
  590
  635
  682
  730
  781
  833
  888
  944
  1,003
  1,065
  1,129
  1,196
Fixed operating expenses, $m
  15
  16
  16
  16
  17
  17
  17
  18
  18
  19
  19
  19
  20
  20
  21
  21
  22
  22
  23
  23
  24
  24
  25
  25
  26
  26
  27
  28
  28
  29
Total operating expenses, $m
  79
  95
  111
  129
  150
  172
  195
  221
  249
  278
  309
  341
  375
  411
  448
  487
  528
  569
  613
  658
  706
  754
  806
  858
  914
  970
  1,030
  1,093
  1,157
  1,225
Operating income, $m
  -77
  -91
  -107
  -125
  -144
  -165
  -188
  -213
  -239
  -267
  -297
  -328
  -361
  -395
  -431
  -468
  -507
  -547
  -589
  -633
  -678
  -725
  -774
  -825
  -877
  -932
  -990
  -1,049
  -1,111
  -1,176
EBITDA, $m
  -77
  -91
  -107
  -124
  -144
  -165
  -188
  -213
  -239
  -267
  -297
  -328
  -360
  -395
  -430
  -467
  -506
  -546
  -588
  -632
  -677
  -724
  -773
  -824
  -876
  -931
  -988
  -1,048
  -1,110
  -1,174
Interest expense (income), $m
  0
  0
  0
  0
  0
  1
  1
  2
  2
  3
  3
  4
  5
  6
  6
  7
  8
  9
  10
  11
  12
  13
  14
  15
  16
  17
  18
  20
  21
  23
  24
Earnings before tax, $m
  -77
  -91
  -107
  -125
  -145
  -167
  -190
  -215
  -242
  -271
  -301
  -333
  -366
  -401
  -438
  -476
  -516
  -557
  -600
  -644
  -691
  -739
  -789
  -841
  -895
  -951
  -1,009
  -1,070
  -1,134
  -1,200
Tax expense, $m
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
Net income, $m
  -77
  -91
  -107
  -125
  -145
  -167
  -190
  -215
  -242
  -271
  -301
  -333
  -366
  -401
  -438
  -476
  -516
  -557
  -600
  -644
  -691
  -739
  -789
  -841
  -895
  -951
  -1,009
  -1,070
  -1,134
  -1,200

BALANCE SHEET

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Cash and short-term investments, $m
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
Total assets, $m
  30
  37
  44
  53
  62
  73
  84
  95
  108
  122
  136
  151
  167
  183
  200
  218
  237
  257
  277
  298
  320
  343
  366
  391
  417
  443
  471
  500
  530
  561
Adjusted assets (=assets-cash), $m
  30
  37
  44
  53
  62
  73
  84
  95
  108
  122
  136
  151
  167
  183
  200
  218
  237
  257
  277
  298
  320
  343
  366
  391
  417
  443
  471
  500
  530
  561
Revenue / Adjusted assets
  0.100
  0.081
  0.091
  0.094
  0.081
  0.082
  0.083
  0.084
  0.083
  0.090
  0.088
  0.086
  0.090
  0.087
  0.085
  0.087
  0.089
  0.086
  0.087
  0.087
  0.088
  0.087
  0.087
  0.087
  0.086
  0.088
  0.087
  0.086
  0.087
  0.087
Average production assets, $m
  0
  0
  1
  1
  1
  1
  1
  1
  1
  1
  2
  2
  2
  2
  2
  3
  3
  3
  3
  3
  4
  4
  4
  4
  5
  5
  5
  6
  6
  6
Working capital, $m
  -16
  -20
  -24
  -29
  -34
  -39
  -45
  -52
  -59
  -66
  -74
  -82
  -90
  -99
  -108
  -118
  -128
  -139
  -150
  -161
  -173
  -185
  -198
  -211
  -225
  -240
  -255
  -270
  -287
  -303
Total debt, $m
  -6
  0
  7
  15
  23
  32
  42
  53
  64
  77
  89
  103
  117
  132
  148
  164
  181
  198
  216
  235
  255
  276
  297
  319
  342
  366
  391
  417
  444
  472
Total liabilities, $m
  27
  33
  40
  48
  56
  65
  75
  86
  97
  109
  122
  136
  150
  165
  180
  197
  214
  231
  249
  268
  288
  308
  330
  352
  375
  399
  424
  450
  477
  505
Total equity, $m
  3
  4
  4
  5
  6
  7
  8
  10
  11
  12
  14
  15
  17
  18
  20
  22
  24
  26
  28
  30
  32
  34
  37
  39
  42
  44
  47
  50
  53
  56
Total liabilities and equity, $m
  30
  37
  44
  53
  62
  72
  83
  96
  108
  121
  136
  151
  167
  183
  200
  219
  238
  257
  277
  298
  320
  342
  367
  391
  417
  443
  471
  500
  530
  561
Debt-to-equity ratio
  -1.910
  0.080
  1.610
  2.790
  3.720
  4.470
  5.070
  5.560
  5.960
  6.300
  6.580
  6.820
  7.030
  7.210
  7.360
  7.500
  7.610
  7.720
  7.810
  7.900
  7.970
  8.040
  8.100
  8.160
  8.210
  8.260
  8.300
  8.340
  8.380
  8.410
Adjusted equity ratio
  0.100
  0.100
  0.100
  0.100
  0.100
  0.100
  0.100
  0.100
  0.100
  0.100
  0.100
  0.100
  0.100
  0.100
  0.100
  0.100
  0.100
  0.100
  0.100
  0.100
  0.100
  0.100
  0.100
  0.100
  0.100
  0.100
  0.100
  0.100
  0.100
  0.100

CASH FLOW

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net income, $m
  -77
  -91
  -107
  -125
  -145
  -167
  -190
  -215
  -242
  -271
  -301
  -333
  -366
  -401
  -438
  -476
  -516
  -557
  -600
  -644
  -691
  -739
  -789
  -841
  -895
  -951
  -1,009
  -1,070
  -1,134
  -1,200
Depreciation, amort., depletion, $m
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  1
  1
  1
  1
  1
  1
  1
  1
  1
  1
  1
  1
  1
  1
  1
Funds from operations, $m
  -77
  -91
  -107
  -125
  -145
  -166
  -190
  -215
  -242
  -271
  -301
  -333
  -366
  -401
  -437
  -475
  -515
  -556
  -599
  -644
  -690
  -738
  -788
  -840
  -894
  -950
  -1,008
  -1,069
  -1,132
  -1,198
Change in working capital, $m
  -3
  -4
  -4
  -5
  -5
  -6
  -6
  -6
  -7
  -7
  -8
  -8
  -9
  -9
  -9
  -10
  -10
  -11
  -11
  -11
  -12
  -12
  -13
  -13
  -14
  -14
  -15
  -16
  -16
  -17
Cash from operations, $m
  -74
  -87
  -103
  -120
  -140
  -161
  -184
  -209
  -235
  -263
  -293
  -324
  -357
  -392
  -428
  -466
  -505
  -546
  -588
  -632
  -678
  -726
  -775
  -826
  -880
  -935
  -993
  -1,053
  -1,116
  -1,181
Maintenance CAPEX, $m
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  -1
  -1
  -1
  -1
  -1
  -1
  -1
  -1
  -1
  -1
  -1
  -1
  -1
  -1
New CAPEX, $m
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
Cash from investing activities, $m
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  -1
  -1
  -1
  -1
  -1
  -1
  -1
  -1
  -1
  -1
  -1
  -1
  -1
  -1
Free cash flow, $m
  -74
  -87
  -103
  -120
  -140
  -161
  -184
  -209
  -235
  -264
  -293
  -325
  -358
  -393
  -429
  -466
  -506
  -546
  -589
  -633
  -679
  -727
  -776
  -828
  -881
  -937
  -995
  -1,055
  -1,118
  -1,183
Issuance/(repayment) of debt, $m
  -6
  6
  7
  8
  8
  9
  10
  11
  11
  12
  13
  14
  14
  15
  16
  16
  17
  18
  18
  19
  20
  20
  21
  22
  23
  24
  25
  26
  27
  28
Issuance/(repurchase) of shares, $m
  90
  91
  108
  126
  146
  168
  191
  216
  244
  272
  303
  334
  368
  403
  440
  478
  517
  559
  602
  646
  693
  741
  791
  843
  897
  953
  1,012
  1,073
  1,137
  1,203
Cash from financing (excl. dividends), $m  
  84
  97
  115
  134
  154
  177
  201
  227
  255
  284
  316
  348
  382
  418
  456
  494
  534
  577
  620
  665
  713
  761
  812
  865
  920
  977
  1,037
  1,099
  1,164
  1,231
Total cash flow (excl. dividends), $m
  11
  10
  12
  13
  14
  16
  17
  18
  19
  21
  22
  23
  24
  25
  26
  28
  29
  30
  31
  32
  34
  35
  36
  38
  39
  41
  42
  44
  46
  48
Retained Cash Flow (-), $m
  -90
  -91
  -108
  -126
  -146
  -168
  -191
  -216
  -244
  -272
  -303
  -334
  -368
  -403
  -440
  -478
  -517
  -559
  -602
  -646
  -693
  -741
  -791
  -843
  -897
  -953
  -1,012
  -1,073
  -1,137
  -1,203
Prev. year cash balance distribution, $m
  114
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
Cash flow adjustment, $m
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
Cash available for distribution, $m
  35
  -81
  -96
  -113
  -131
  -152
  -174
  -198
  -224
  -252
  -281
  -311
  -344
  -378
  -413
  -450
  -489
  -529
  -571
  -614
  -659
  -706
  -755
  -805
  -858
  -913
  -970
  -1,029
  -1,091
  -1,155
Discount rate, %
  4.30
  4.52
  4.74
  4.98
  5.23
  5.49
  5.76
  6.05
  6.35
  6.67
  7.00
  7.35
  7.72
  8.11
  8.51
  8.94
  9.39
  9.86
  10.35
  10.87
  11.41
  11.98
  12.58
  13.21
  13.87
  14.56
  15.29
  16.05
  16.86
  17.70
PV of cash for distribution, $m
  33
  -74
  -84
  -93
  -102
  -110
  -118
  -124
  -129
  -132
  -133
  -133
  -131
  -127
  -121
  -114
  -106
  -97
  -88
  -78
  -68
  -59
  -49
  -41
  -33
  -27
  -21
  -16
  -12
  -9
Current shareholders' claim on cash, %
  50.0
  1.8
  0.1
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0

Syndax Pharmaceuticals, Inc (Syndax) is a clinical stage biopharmaceutical company focused on developing a pipeline of combination therapies in multiple cancer indications. The Company’s product candidate, entinostat, which was granted Breakthrough Therapy designation by the FDA following positive results from its Phase IIb clinical trial, ENCORE 301, is being evaluated in a Phase III clinical trial for advanced hormone receptor positive breast cancer. It is developing entinostat, which has direct effects on both cancer cells and immune regulatory cells, and SNDX-6352, an anti-CSF-1R monoclonal antibody, to enhance the body's immune response on tumors that have shown sensitivity to immunotherapy. Entinostat is being evaluated as a combination therapeutic in Phase Ib/II clinical trials with Merck & Co., Inc. for non-small cell lung cancer and melanoma, with Genentech, Inc. for TNBC, and with Pfizer Inc. and Merck KGaA, Darmstadt, Germany, for ovarian cancer.

FINANCIAL RATIOS  of  Syndax Pharmaceuticals (SNDX)

Valuation Ratios
P/E Ratio -2
Price to Sales 89.6
Price to Book 1.1
Price to Tangible Book
Price to Cash Flow -2.6
Price to Free Cash Flow -2.6
Growth Rates
Sales Growth Rate 0%
Sales - 3 Yr. Growth Rate %
EPS Growth Rate %
EPS - 3 Yr. Growth Rate %
Capital Spending Gr. Rate NaN%
Cap. Spend. - 3 Yr. Gr. Rate NaN%
Financial Strength
Quick Ratio NaN
Current Ratio 0.1
LT Debt to Equity 0%
Total Debt to Equity 0%
Interest Coverage 0
Management Effectiveness
Return On Assets -44.2%
Ret/ On Assets - 3 Yr. Avg. -74.1%
Return On Total Capital -58.3%
Ret/ On T. Cap. - 3 Yr. Avg. -107.4%
Return On Equity -58.3%
Return On Equity - 3 Yr. Avg. -267.9%
Asset Turnover 0
Profitability Ratios
Gross Margin 0%
Gross Margin - 3 Yr. Avg. 0%
EBITDA Margin -4400%
EBITDA Margin - 3 Yr. Avg. -2233.3%
Operating Margin -4400%
Oper. Margin - 3 Yr. Avg. -2133.3%
Pre-Tax Margin -4400%
Pre-Tax Margin - 3 Yr. Avg. -2266.7%
Net Profit Margin -4400%
Net Profit Margin - 3 Yr. Avg. -2266.7%
Effective Tax Rate 0%
Eff/ Tax Rate - 3 Yr. Avg. 0%
Payout Ratio 0%

SNDX stock valuation input parameters

Revenue. Company's revenue (or sales) is always the starting point of any cash flow forecast. In the SNDX stock intrinsic value calculation we used $2.108 million for the last fiscal year's total revenue generated by Syndax Pharmaceuticals. The default revenue input number comes from 0001 income statement of Syndax Pharmaceuticals. You may change it if you feel that it should be adjusted for some unusual circumstances that are not expected to be repeated in the future or if you already know (from interim financial statements, for example) that this year's revenue is going to be quite different.

Revenue growth rate. Forecasted future revenue growth rate is the most important input parameter for the intrinsic value calculation. Unlike other input parameters that are reasonably expected to be in line with their historic averages or their historic trends, the revenue growth rate by and large is a wild card: nobody really knows what the company's revenue will be in the future. Of course, the level of unpredictability is different for different industries (utility companies being the most predictable and, thus, less risky).
    We use three input parameters to forecast the revenue growth rate in our SNDX stock valuation model: a) initial revenue growth rate of 24.3% whose default value is the revenue growth rate in the most recent quarter compared to the quarterly revenue a year ago; b) terminal revenue growth rate of 5% whose default value is chosen to be close to the average nominal (i.e. not adjusted for inflation) GDP growth rate; and c) revenue decline factor of 0.9, which stipulates that revenue growth rate in each forecasted year will be equal to the difference of the revenue growth rate in the preceding year and the terminal revenue growth rate multiplied by this revenue decline factor (with the passage of time the revenue growth rate will be approaching the terminal revenue growth rate, but not quite reaching it - though the difference could be infinitesimally small).
    At the revenue decline factor of 1, the future revenue growth rate is forecasted to be constant and equal to the initial revenue growth rate. The smaller the revenue decline factor, the faster the revenue growth rate will approach the terminal revenue growth.

Discount rate. The discount rate is used for determining the present value of future cash flows: future cash flows are "discounted" as at normal conditions (that translate into positive expected return on investment) one dollar today is worth more than the same dollar in the future. Unlike all other valuation models, we use variable discount rate, i.e. it increases for each consecutive year. This is done to account for higher risk of cash flows coming in further in the future.
    The initial discount rate of 4.3%, whose default value for SNDX is calculated based on our internal credit rating of Syndax Pharmaceuticals, is applied to the cash flow expected to be received a year from now (well, actually, to be precise, in the financial year following the base year - the last year for which we have financial statements). For each consecutive year the discount rate is multiplied by the discount rate multiplier of 1.05, e.i. each year it increases by 5%. Feel free to change this number to correspond to your level of risk assessment of Syndax Pharmaceuticals.
    By the way, it is easy to set the discount rate to be constant (this would make comparison with other valuation models easier): just set the discount rate multiplier equal to 1 and chose the magnitude of the initial discount rate to your liking.

Variable cost ratio is the ratio of variable costs (i.e. costs that fluctuate with fluctuation of the volume of production) to the revenue expressed as a percentage. In the calculation of intrinsic value of SNDX stock the variable cost ratio is equal to 2450%.

Fixed operating expenses is just that - expenses that are not dependant on the volume of production. They are set to $15 million in the base year in the intrinsic value calculation for SNDX stock. These expenses increase with the level of inflation in subsequent years.

Interest rate on debt is the average all-in rate of interest paid by the company on its debt. It is set at 5.4% for Syndax Pharmaceuticals.

Corporate tax rate of 27% is the nominal tax rate for Syndax Pharmaceuticals. In reality, companies find ways to pay much less taxes than that or not to pay them at all.

Cash flow adjustment could be used for any adjustment the investor deems necessary. Most commonly we use this field to account for stock options-related effects in excess of what is reported on the company's income statement. The cash flow adjustment is expressed as a percentage of the revenue, and in the current valuation of the SNDX stock is equal to 0%.

Production assets are the company's assets used for manufacturing products or provision of services. In the valuation model input table they are expressed as a percentage of revenue and for SNDX are equal to 13.2%.

Life of production assets of 3.5 years is the average useful life of capital assets used in Syndax Pharmaceuticals operations. It is used to calculate yearly capital expenditures needed to keep these assets in good order - we call it the maintenance CAPEX.

Working capital is the difference between the company's current assets and liabilities. In the model we use the ratio of working capital to revenue, which for SNDX is equal to -621.8%. A negative number means that the company is apt at using financial resources of its suppliers and customers; a large positive number, on the other hand, means that it either provides in-kind financing to others or is not good at managing its inventories.

Book value of equity - $104.319 million for Syndax Pharmaceuticals - is used in calculation of the "floor" for intrinsic valuation based on the discounted cash flow (DCF) method. Even if the prospects are very bad for a company, its assets could always be sold now for their current fair market value.

Shares outstanding of 24.706 million for Syndax Pharmaceuticals is needed to calculate the intrinsic value of one share.

Market capitalization is used here only for reference purposes and as a quick check that the share price and the number of shares outstanding numbers are correct - something especially to be cognizant about at stock splits. So, the market capitalization of Syndax Pharmaceuticals at the current share price and the inputted number of shares is $0.1 billion.

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COMPANY NEWS

▶ Syndax Announces Changes to its Board of Directors   [Sep-25-18 04:05PM  PR Newswire]
▶ Syndax Pharmaceuticals (SNDX) Reports Q2 Loss   [Aug-07-18 06:20PM  Zacks]
▶ Syndax: 2Q Earnings Snapshot   [05:15PM  Associated Press]
▶ Syndax: 1Q Earnings Snapshot   [May-08-18 06:16PM  Associated Press]
▶ 3 Biotech Stocks That Soared This Week: Are They Buys?   [Mar-17-18 08:32AM  Motley Fool]
▶ Here's Why Syndax Pharmaceuticals Is Soaring Today   [Mar-14-18 03:43PM  Motley Fool]
▶ Syndax reports 4Q loss   [Mar-05-18 04:37PM  Associated Press]
▶ 4 of the Best Stocks to Buy on Earnings Acceleration   [Jan-18-18 09:45AM  InvestorPlace]
▶ Syndax reports 3Q loss   [Nov-07-17 06:24PM  Associated Press]
▶ Syndax reports 2Q loss   [Aug-10-17 09:43PM  Associated Press]
▶ 3 Under-the-Radar Stocks in the Healthcare Sector   [Jul-26-17 08:08AM  Motley Fool]
▶ Syndax Prices Public Offering of Common Stock   [May-24-17 07:22PM  GlobeNewswire]
▶ Syndax Announces Proposed Public Offering of Common Stock   [May-23-17 04:48PM  GlobeNewswire]
▶ Why Syndax Shares Are Rallying   [10:35AM  24/7 Wall St.]
▶ Syndax reports 1Q loss   [04:27PM  Associated Press]

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