CERS 2.15 (+1.9%)
US1570851014BiotechnologyBiotechnology

Last update on 2024-06-07

Cerus (CERS) - Piotroski F-Score Analysis for Year 2023 (Final Score: 5/9)

Piotroski F-Score Analysis of Cerus (CERS) for 2023 reveals a score of 5/9, highlighting the company's financial position, profitability, liquidity, and leverage.

Knowledge hint:
The Piotroski F-Score is a number between 0 to 9 which reflects the strength of a company's financial position. It is based on 9 criteria involving profitability, liquidity, and leverage. This model helps investors identify stocks that are strong, undervalued investments.
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Short Analysis - Piotroski Score: 5

We're running Cerus (CERS) against the Piotroski 9-criteria scoring system to assess profitability, liquidity, and operating efficiency:

Criteria
Company has a positive net income?
0
Company has a positive cash flow?
0
Return on Assets (ROA) are growing?
1
Operating Cashflow are higher than Netincome?
0
Leverage is declining?
0
Current Ratio is growing?
1
Number of shares not diluted?
1
Cross Margin is growing?
1
Asset Turnover Ratio is growing?
1

The Piotroski F-Score is a measure of a company's financial strength, ranging from 0 to 9. A higher score indicates a stronger financial position. Cerus (CERS) has an overall Piotroski Score of 5 out of 9 based on its 2023 performance, indicating a moderately weak financial position.

Insights for Value Investors Seeking Stable Income

Investors should be cautious with Cerus (CERS). Despite some positive signs like a marginally improving Return on Assets (ROA), growing Gross Margin, increased Current Ratio, and improved Asset Turnover, the company struggles with consistent negative net income and operating cash flows, as well as increased leverage and potential equity dilution. Further, due to these financial challenges and persistent negative trends, potential investors might want to conduct more in-depth research or consider waiting for more substantial signs of financial health before investing.

For those who are interested in delving deeper into the specifics, the subsequent section provides a comprehensive exploration of the criteria.

Profitability of Cerus (CERS)

Company has a positive net income?

The criterion checks if the net income for Cerus (CERS) is positive. Positive net income indicates profitability, while negative net income signifies losses.

Historical Net Income of Cerus (CERS)

In 2023, Cerus (CERS) reported a net income of -$37,489,000. This is a negative value, continuing the trend of losses the company has experienced over the past two decades. The net income has fluctuated but has remained predominantly negative, with the last positive net income being reported in 2005. Thus, for the Piotroski F-Score, Cerus receives 0 points for this criterion.

Company has a positive cash flow?

Cash Flow from Operations (CFO) assesses the cash generating ability of a company's core business activities. Positive CFO is preferable as it suggests a company's operations are generating sufficient cash.

Historical Operating Cash Flow of Cerus (CERS)

Cerus (CERS) reported a negative CFO of -$43,168,000 in 2023, thus earning 0 points in this criterion. Analyzing the last 20 years of CFO data for Cerus reveals a consistent trend of negative CFO from 2003 to 2023, with figures ranging from -$12,728,000 in 2004 to a low of -$65,838,000 in 2019. The persistent negative CFO highlights chronic issues in cash generation from Cerus' operations, indicating potential challenges in sustaining daily operations and investing in growth without relying on external financing or equity raises. This trend could be interpreted as a significant red flag for investors and underscores the importance of strategies aimed at improving operational efficiencies and cash flow management in the company.

Return on Assets (ROA) are growing?

Change in ROA reflects a company's efficiency at generating profits from its assets over a given period. This metric is crucial for understanding the company's operational performance relative to its asset base.

Historical change in Return on Assets (ROA) of Cerus (CERS)

The Return on Assets (ROA) for Cerus (CERS) increased from -0.1878 in 2022 to -0.1803 in 2023, thus earning 1 point in the Piotroski Score. Although the company still reports a negative ROA, the less negative figure indicates a marginal improvement in asset utilization. This can be seen as a positive trend, albeit minor. It's essential to consider industry benchmarks in this context. Over the last 20 years, the industry median ROA portrays consistently positive figures, indicating Cerus is lagging significantly behind its peers in terms of asset efficiency. For instance, the industry median ROA for 2023 stands at 0.4518, starkly contrasting Cerus' -0.1803. Historical data reveals that despite achieving higher-than-usual operational cash flows in years like 2020, Cerus hasn't translated this into proportional ROA improvements. Overall, while the upward trend in 2023 is a positive indicator, Cerus needs substantial and sustained improvements to match industry performance.

Operating Cashflow are higher than Netincome?

This criterion evaluates whether the company's operating cash flow is higher than its net income. Positive operating cash flow relative to net income indicates efficient cash management and operations.

Historical accruals of Cerus (CERS)

For the year 2023, Cerus reported an operating cash flow of -$43.17 million, which is lower than its net income of -$37.49 million. This results in zero points for this criterion. Lower operating cash flow compared to net income suggests that Cerus may be encountering challenges in generating cash from its core business operations. Historically, Cerus has struggled with generating positive cash flow, as shown by its operating cash flows being negative for the past 20 years. This persistent trend raises concerns about Cerus's ability to finance its operations without relying heavily on external sources of capital. Overall, this indicator highlights potential issues in Cerus's cash management practices.

Liquidity of Cerus (CERS)

Leverage is declining?

The criterion evaluates if the company's leverage has decreased, which indicates a stronger financial health and reduced bankruptcy risk.

Historical leverage of Cerus (CERS)

The leverage ratio for Cerus (CERS) increased from 0.1328 in 2022 to 0.3719 in 2023. This means that the company took on more debt in relation to its equity. Historically, as shown in the last 20 years of data, the leverage ratio has fluctuated, with notable increases in periods such as 2015 and recent spikes in 2019 and 2023. The increased leverage in 2023 suggests a higher financial risk, making it a concerning trend for conservative investors. Given this trend, Cerus does not score a point for this Piotroski criterion. The result remains 0.

Current Ratio is growing?

The current ratio measures a company's ability to cover its short-term liabilities with its short-term assets, and a higher ratio indicates better short-term financial health.

Historical Current Ratio of Cerus (CERS)

Cerus (CERS) has shown an increase in its Current Ratio from 1.4535 in 2022 to 2.1392 in 2023. This rise represents an improved capacity to cover short-term liabilities, indicating a positive shift in liquidity. Considering that the industry median current ratio for 2023 is 5.7831, Cerus still lags behind its industry peers. However, the trend itself is favorable, earning a score of 1 point in this criterion. Over the long-term, Cerus' current ratio has fluctuated significantly, peaking at 6.9355 in 2006 and hitting a low of 1.3126 in 2004. This recent upward trend suggests a recovery phase in Cerus' short-term financial health, albeit some way off the industry's median value.

Number of shares not diluted?

Changes in Outstanding Shares reflect company equity actions and impact the EPS and owners' stake.

Historical outstanding shares of Cerus (CERS)

Cerus (CERS) shows an increase in outstanding shares from 176,545,000 in 2022 to 0 in 2023. This implies outstanding shares haven't decreased and prompts a value of 0 points for this Piotroski criterion. Assess the consistent trend: shares grew notably from 19,366,727 in 2003, peaking in 2022 before vanishing, underscoring equity dilution and potential restructuring in 2023. Such fluctuations generally signal dilution and financial instability.

Operating of Cerus (CERS)

Cross Margin is growing?

Gross Margin assesses a company's financial health by revealing the percentage of revenue exceeding the cost of goods sold.

Historical gross margin of Cerus (CERS)

In 2023, Cerus (CERS) reported a Gross Margin of 0.5525, up from 0.5375 in 2022. This increase of approximately 1.5% is a positive sign, indicating improved cost efficiency. The long-term data reveals fluctuating margins with notable peaks in 2006 and 2018, whereas the industry median showed higher stability. Despite trailing the industry's 0.4518 in 2023, this uptick earns Cerus 1 point in Piotroski Analysis.

Asset Turnover Ratio is growing?

Change in Asset Turnover assesses a company's efficiency in using its assets to generate sales. An improvement suggests better performance.

Historical asset turnover ratio of Cerus (CERS)

The Asset Turnover for Cerus (CERS) increased from 0.7114 in 2022 to 0.7521 in 2023. This increase signals that Cerus has improved its efficiency in using its assets to generate sales. Over a span of 20 years, the Asset Turnover has generally shown positive growth with fluctuations. For example, the ratio improved from lows such as 0.101 in 2003 to highs of 0.7521 as seen recently in 2023. This long-term upward trajectory is an encouraging sign indicating growth and improved management efficiency. We can thus add 1 point for this positive development in the Piotroski score.


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