Guardant Health, Inc. Fundamental Analysis (NASDAQ: GH)
Guardant Health, Inc. Fundamental Analysis (NASDAQ: GH)
Guardant Health, Inc. (NASDAQ: GH) shows moderate financial fundamentals with a PE ratio of -41.78, profit margin of -37.93%, and ROE of 2.49%. The company generates $1.3B in annual revenue with strong year-over-year growth of 32.88%.
Key Strengths
Areas of Concern
The stock receives a Fundamental Health Score of 100.3/100 based on profitability, valuation, growth, and balance sheet metrics. The A grade reflects excellent fundamentals and strong overall stability.
Fundamental Health Score
We analyze GH's fundamental strength across five key dimensions:
Efficiency Score
WeakGH struggles to generate sufficient returns from assets.
Valuation Score
ModerateGH shows balanced valuation metrics.
Growth Score
ModerateGH shows steady but slowing expansion.
Financial Health Score
ExcellentGH maintains a strong and stable balance sheet.
Profitability Score
WeakGH struggles to sustain strong margins.
Key Financial Metrics
Is GH Expensive or Cheap?
P/E Ratio
GH trades at -41.78 times earnings. This suggests potential undervaluation.
PEG Ratio
When adjusting for growth, GH's PEG of 3.16 indicates potential overvaluation.
Price to Book
The market values Guardant Health, Inc. at -74.90 times its book value. This may indicate undervaluation.
EV/EBITDA
Enterprise value stands at -45.61 times EBITDA. This is generally considered low.
How Well Does GH Make Money?
Net Profit Margin
For every $100 in sales, Guardant Health, Inc. keeps $-37.93 as profit after all expenses.
Operating Margin
Core operations generate -39.41 in profit for every $100 in revenue, before interest and taxes.
ROE
Management delivers $2.49 in profit for every $100 of shareholder equity.
ROA
Guardant Health, Inc. generates $-25.72 in profit for every $100 in assets, demonstrating efficient asset deployment.
Following the Money - Real Cash Generation
Operating Cash Flow
Guardant Health, Inc. generates limited operating cash flow of $-174.60M, signaling weaker underlying cash strength.
Free Cash Flow
Guardant Health, Inc. generates weak or negative free cash flow of $-233.64M, restricting financial flexibility.
FCF Per Share
Each share generates $-1.73 in free cash annually.
FCF Yield
GH converts -1.11% of its market value into free cash.
Financial Ratios Analysis
Valuation Ratios
P/E Ratio
Price to earnings ratio
-41.78
vs 25 benchmark
PEG Ratio
Price/earnings to growth ratio
3.16
vs 25 benchmark
P/B Ratio
Price to book value ratio
-74.90
vs 25 benchmark
P/S Ratio
Price to sales ratio
16.26
vs 25 benchmark
Financial Health
Debt/Equity
Total debt to shareholders' equity
-6.13
vs 25 benchmark
Current Ratio
Current assets to current liabilities
3.60
vs 25 benchmark
Efficiency Ratios
ROE
Return on equity percentage
2.49
vs 25 benchmark
ROA
Return on assets percentage
-0.26
vs 25 benchmark
ROCE
Return on capital employed
-0.33
vs 25 benchmark
How GH Stacks Against Its Sector Peers
| Metric | GH Value | Sector Average | Performance |
|---|---|---|---|
| P/E Ratio | -41.78 | 31.66 | Better (Cheaper) |
| ROE | 249.03% | 501.00% | Weak |
| Net Margin | -37.93% | -3647.00% (disorted) | Weak |
| Debt/Equity | -6.13 | -0.30 (disorted) | Distorted |
| Current Ratio | 3.60 | 5.78 | Strong Liquidity |
| ROA | -25.72% | -262.00% (disorted) | Weak |
GH outperforms its industry in 2 out of 6 key metrics, but lagging in ROE.
Historical Growth Performance
5-Year Growth Trajectory
This section reviews Guardant Health, Inc.'s 5-year compound annual growth rate (CAGR) and compares its performance against the typical investment style of its industry.
Revenue CAGR
166.36%
Industry Style: Defensive, Growth, Innovation
High GrowthEPS CAGR
-27.57%
Industry Style: Defensive, Growth, Innovation
DecliningFCF CAGR
-38.26%
Industry Style: Defensive, Growth, Innovation
Declining