Companies Like Fulgent Genetics (NASDAQ:FLGT) Are In A Position To Invest In Growth

Simply Wall St.11-10

Even when a business is losing money, it's possible for shareholders to make money if they buy a good business at the right price. For example, biotech and mining exploration companies often lose ...

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For example, biotech and mining exploration companies often lose ...</p>\n\n<a href=\"https://finance.yahoo.com/news/companies-fulgent-genetics-nasdaq-flgt-131622798.html\">Source Link</a>\n\n</div>\n\n\n</article>\n</div>\n</body>\n</html>\n","isBrief":false,"type":0,"news_type":1,"symbol":"QID","symbol_name":"纳指两倍做空ETF","start_time":0,"source_url":"https://finance.yahoo.com/news/companies-fulgent-genetics-nasdaq-flgt-131622798.html","article_id":"2482265914","we_media_id":null,"thumbnails":["https://s.yimg.com/uu/api/res/1.2/wPCaEqo0Eoh8gNU.SS4ZzA--~B/aD00MzI7dz0xMTk0O2FwcGlkPXl0YWNoeW9u/https://media.zenfs.com/en/simply_wall_st__316/5bcfe52095f73041f79c669b593d7118"],"rights":null,"url":"https://stock-news.laohu8.com/highlight/detail?id=2482265914","pubTimestamp":1731244582,"sourceInfo":{"source_id":"yahoofinance","name":"雅虎金融"},"weMediaInfo":null,"summary":"Even when a business is losing money, it's possible for shareholders to make money if they buy a good business at the right price. For example, biotech and mining exploration companies often lose money for years before finding success with a new treatment or mineral discovery. But the harsh reality is that very many loss making companies burn through all their cash and go bankrupt.Given this risk, we thought we'd take a look at whether Fulgent Genetics  shareholders should be worried about its cash burn. For the purposes of this article, cash burn is the annual rate at which an unprofitable company spends cash to fund its growth; its negative free cash flow. First, we'll determine its cash runway by comparing its cash burn with its cash reserves.Check out our latest analysis for Fulgent Genetics. Fulgent Genetics has a market capitalisation of US$589m and burnt through US$29m last year, which is 4.9% of the company's market value. Given that is a rather small percentage, it would proba","collect":0,"end_time":0,"defaultTopTitle":"yahoo.com","property":[],"viewcount":null,"language":"en","relate_stocks":{"QID":"纳指两倍做空ETF","BK4585":"ETF&股票定投概念","BK4196":"保健护理服务","SQQQ":"纳指三倍做空ETF","LU2095319765.USD":"Natixis Thematics Subscription Economy R/A USD","QLD":"纳指两倍做多ETF","PSQ":"纳指反向ETF","LU2210150020.SGD":"Natixis Thematics Subscription Economy R/A SGD","BK4588":"碎股","LU2210149790.SGD":"Natixis Thematics Subscription Economy R/A SGD-H","IE00BKPKM429.USD":"NEUBERGER BERMAN GLOBAL SUSTAINABLE EQUITY \"A\" (USD) ACC",".IXIC":"NASDAQ Composite","IE00B64PRP62.GBP":"GUINNESS GLOBAL MONEY MANAGERS \"C\" (GBP) ACC","TQQQ":"纳指三倍做多ETF","IE00B3QW5Z07.USD":"GUINNESS GLOBAL MONEY MANAGERS \"C\" (USD) ACC","IE00BGHQF748.EUR":"GUINNESS GLOBAL MONEY MANAGERS \"C\" (EUR) ACC","FLGT":"Fulgent Genetics Inc.","BK4112":"金融交易所和数据","NDAQ":"纳斯达克OMX交易所"},"translate_title":"像Fulgent Genetics（纳斯达克股票代码：FLGT）这样的公司有能力投资增长","themeId":null,"isJumpTheme":false,"ttsUrl":null,"symbols_score_info":{"FLGT":1,"NDAQ":1,".IXIC":1,"TQQQ":0.6,"SQQQ":0.6,"QLD":0.6,"QID":0.6,"PSQ":0.6,"NQmain":0.6,"MNQmain":0.6},"content_text":"Even when a business is losing money, it's possible for shareholders to make money if they buy a good business at the right price. For example, biotech and mining exploration companies often lose money for years before finding success with a new treatment or mineral discovery. But the harsh reality is that very many loss making companies burn through all their cash and go bankrupt. \n Given this risk, we thought we'd take a look at whether Fulgent Genetics (NASDAQ:FLGT) shareholders should be worried about its cash burn. For the purposes of this article, cash burn is the annual rate at which an unprofitable company spends cash to fund its growth; its negative free cash flow. First, we'll determine its cash runway by comparing its cash burn with its cash reserves. \n Check out our latest analysis for Fulgent Genetics \n When Might Fulgent Genetics Run Out Of Money? \n A company's cash runway is the amount of time it would take to burn through its cash reserves at its current cash burn rate. Fulgent Genetics has such a small amount of debt that we'll set it aside, and focus on the US$213m in cash it held at September 2024. Looking at the last year, the company burnt through US$29m. That means it had a cash runway of about 7.4 years as of September 2024. While this is only one measure of its cash burn situation, it certainly gives us the impression that holders have nothing to worry about. The image below shows how its cash balance has been changing over the last few years. \n\n\n\n  NasdaqGM:FLGT Debt to Equity History November 10th 2024\n \n\n Is Fulgent Genetics' Revenue Growing? \n We're hesitant to extrapolate on the recent trend to assess its cash burn, because Fulgent Genetics actually had positive free cash flow last year, so operating revenue growth is probably our best bet to measure, right now. Regrettably, the company's operating revenue moved in the wrong direction over the last twelve months, declining by 3.0%. While the past is always worth studying, it is the future that matters most of all. So you might want to take a peek at how much the company is expected to grow in the next few years. \n Can Fulgent Genetics Raise More Cash Easily? \n Since its revenue growth is moving in the wrong direction, Fulgent Genetics shareholders may wish to think ahead to when the company may need to raise more cash. Companies can raise capital through either debt or equity. Many companies end up issuing new shares to fund future growth. By looking at a company's cash burn relative to its market capitalisation, we gain insight on how much shareholders would be diluted if the company needed to raise enough cash to cover another year's cash burn. \n Fulgent Genetics has a market capitalisation of US$589m and burnt through US$29m last year, which is 4.9% of the company's market value. Given that is a rather small percentage, it would probably be really easy for the company to fund another year's growth by issuing some new shares to investors, or even by taking out a loan. \n So, Should We Worry About Fulgent Genetics' Cash Burn? \n It may already be apparent to you that we're relatively comfortable with the way Fulgent Genetics is burning through its cash. In particular, we think its cash runway stands out as evidence that the company is well on top of its spending. Although its falling revenue does give us reason for pause, the other metrics we discussed in this article form a positive picture overall. After taking into account the various metrics mentioned in this report, we're pretty comfortable with how the company is spending its cash, as it seems on track to meet its needs over the medium term. Taking an in-depth view of risks, we've identified 2 warning signs for Fulgent Genetics that you should be aware of before investing. \n Of course Fulgent Genetics may not be the best stock to buy. So you may wish to see this free collection of companies boasting high return on equity, or this list of stocks with high insider ownership. \nHave feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.","kind":"highlight","is_publish_news":true,"is_publish_highlight":false,"is_publish_live":false,"is_publish_wemedia":null,"editions":null,"column":"","sentiment":"1","news_tag":"","news_rank":0,"symbols":[],"gpt_button":0},"commentList":[],"isCommentEnd":true,"newsSizeData":{"likeSize":0,"commentSize":0,"repostSize":0,"favoriteSize":0,"likeStatus":false,"favoriteStatus":false},"APP":{"userAgent":"Mozilla/5.0 AppleWebKit/537.36 (KHTML, like Gecko; compatible; ClaudeBot/1.0; +claudebot@anthropic.com)","isDev":false,"isTTM":true,"deviceId":"web-server-community-laohu8-v3","version":"4.29.3","shortVersion":"4.29.3","platform":"web","vendor":"web","appName":"ttm","isIOS":false,"isAndroid":false,"isTiger":false,"isTHS":false,"isWeiXin":false,"isWeiXinMini":false,"isWeiBo":false,"isQQ":false,"isBaiduSwan":false,"isBaiduBox":false,"isDingTalk":false,"isToutiao":false,"isOnePlus":false,"isHuaWei":false,"isXiaomi":false,"isXiaomiWebView":false,"isOppo":false,"isVivo":false,"isSamsung":false,"isMobile":false},"href":"/m/news/2482265914"}