Amicus Therapeutics, Inc.

FOLD Details

Amicus Therapeutics, Inc. (NASDAQ: FOLD) is a biotechnology company specializing in discovering, developing, and commercializing treatments for individuals with rare metabolic illnesses. Galafold (also known as migalastat) is currently being marketed in the United States, the United Kingdom, the European Union (EU), and Japan as the first approved oral treatment for Fabry disease.

Latest News:

• Progressing Towards Regulatory Approval:  The European Medicines Agency (EMA) validated the Marketing Authorization Applications (MAA) for AT-GAA, the company's investigational two-component treatment for treating Pompe illness, on December 3, 2021. The EMA's centralized procedure with the Committee for Medicinal Products for Human Use (CHMP) assessment begins after the application is validated.

Q3FY21 Results:

• Improvement in Revenues: FOLD's revenues increased by 17.95% to USD 79.55 million in Q3FY21 (ended September 30, 2021) compared to USD 67.44 million in Q3FY20, attributable to growth in the US, Europe, and Japan markets.
• Decline in Net Losses: The Q3FY21 net loss decreased to USD 50.29 million from USD 64.01 million in Q3FY20.
• Decent Balance Sheet: As of September 30, 2021, the company had cash & cash equivalents (including short-term investments) of USD 556.96 million and total debt of USD 388.72 million.

Key Risks:

• Product Concentration Risk: FOLD's prospects are dependent on the success of Galafold, its single product offering. It has invested a significant amount of resources in its development, and if it fails to obtain marketing approvals or is unable to set up an efficient manufacturing and distribution mechanism in place, its results of operations could be adversely impacted.

Outlook:

• FY21 Revenue: FOLD expects to clock in USD 300.0 – 315.0 million in revenues in FY21, driven by double-digit growth in US, EU, UK and Japan markets.
• Operating Expenses: FOLD expects to incur non-GAAP operating expenses of USD 410 – 420 million in FY21.

Valuation Methodology: EV/Sales Multiple Based Relative Valuation

(Analysis by Kalkine Group)

* % Premium/(Discount) is based on our assessment of the company's NTM trading multiple after considering its key growth drivers, economic moat, stock's historical trading multiples versus peer average/median, and investment risks.

FOLD Daily Technical Chart (Source: REFINITIV)

Stock Recommendation:

FOLD's stock price decreased 56.09% in the past twelve months and is currently leaning towards the lower end of its 52-week range of USD 8.60 to USD 25.39. The stock is currently trading between its 50 and 200 DMA levels, and its RSI Index is at 44.26. We have valued the stock using the EV/Sales multiple-based relative valuation methodology and arrived at a target price of USD 9.46.

Considering the significant correction in the stock price and current valuation, lack of visibility into profitability, current valuation, and associated risk. We recommend a "Sell" rating on the stock at the current price of USD 10.50, down 1.46% as of December 16, 2021, 10:36 AM ET.

* The reference data in this report has been partly sourced from REFINITIV.

* All forecasted figures and industry information have been taken from REFINITIV.

Limelight Networks, Inc.

LLNW Details

Limelight Networks, Inc. (NASDAQ: LLNW) delivers live streaming sporting events, international movie premieres, video games, and file downloads for new phone apps as a global edge access and content delivery network (CDN) service provider. LLNW also offers digital content distribution, video delivery, cloud security, edge computing, origin storage services, professional services, and other infrastructure services.

Latest News:

• Grant of RSUs: On November 5, 2021, LLNW reported that it had issued an aggregate of 10,691,757 restricted stock units (RSUs) to 56 new employees who joined LLNW as a result of its September 2021 acquisition of Moov Corporation (doing business as Layer0).

Q3FY21 Results:

• Drop in Revenues: The company reported a 6.82% decline in revenues to USD 55.20 million in Q3FY21 (ended September 30, 2021), compared to USD 59.24 million in Q3FY20, attributable to considerable growth in the Asia Pacific segment.
• Increase in Net Losses: LLNW's net loss increased significantly to USD 10.11 million in Q3FY21 from USD 3.99 million in Q3FY20.
• Decent Balance Sheet: The cash and cash equivalents (including marketable securities) totaled USD 75.79 million as of September 30, 2021, with total debt amounting to USD 121.58 million.

Key Risks:

• Customer Concentration: In Q3FY21, LLNW's top 20 customers accounted for ~77% of its net sales. As a result, the loss of any of its key customers could hurt its financials.
• Geographic Concentration: The United States and Japan accounted for more than 10% of the company's total revenue in Q3FY21, according to customer geography. As a result, any significant change in regulatory requirements or economic conditions in these locations could have a negative impact on LLNW's operating results.

Outlook:

• FY21 Estimates: As of Q3FY21 release, LLNW expects its FY21 revenue to range between USD 215 – 220 million, with GAAP and non-GAAP EPS ranging from USD (0.47) to (0.42) and USD (0.17) to (12), respectively. In addition, the estimated adjusted EBITDA range is USD 12 – 15 million.
• CAPEX Estimates: LLNW expects to incur a capital expenditure of USD 15 – 20 million in FY21.

Valuation Methodology: EV/Sales Multiple Based Relative Valuation

(Analysis by Kalkine Group)

* % Premium/(Discount) is based on our assessment of the company's NTM trading multiple after considering its key growth drivers, economic moat, stock's historical trading multiples versus peer average/median, and investment risks.

LLNW Daily Technical Chart (Source: REFINITIV)

Stock Recommendation:

LLNW's stock price has increased 36.07% in the past three months and is currently leaning towards the lower end of the 52-week range of USD 2.30 to USD 5.61. The stock is currently trading above its 50 and 200 DMA levels, and its RSI Index is at 67.10. We have valued the stock using the EV/Sales-based relative valuation method and arrived at a target price of USD 2.99.

Considering the uptick in the stock price and current valuation, we believe the decent business fundamentals are adequately reflected at current trading levels. Hence, we recommend a "Sell" rating on the stock at the current price of USD 3.34, up 0.60% as of December 16, 2021, 10:49 AM ET.

*All forecasted figures and Industry Information have been taken from REFINITIV.

*The reference data in this report has been partly sourced from REFINITIV.

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