FLGT - Fulgent Genetics: Undervalued, CFO Buying, And Promising Drug Candidates Make It A Buy

2025-03-20 05:46:16 ET

Summary

• CFO bought 1.5 million worth on March 5th, a Price/Book ratio of 0.43x and a Net Current Assets Value (NCAV) of 0.68x that day.
• Now it's trading at 0.47x Price/Book Value and 0.72x NCAV, showing a significant undervaluation.
• However, nothing is cheap for no reason; the company is not making money and won't for a while.
• The company has two promising drug candidates in its pipeline. Key trial results are expected at the ASCO meeting in May 2025.
• Current ownership is at 39%. That's quite a bit of skin in the game.

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Thesis

I rate Fulgent Genetics Inc (FLGT) as a "Buy", with a strong warning about growth and profitability. Potential discount of 28%, if we value it following the Net Current Assets Value (NCAV) concept.

Fulgent Genetics is a healthcare diagnostics & research company that is trading at 0.46x Price to Book Value. Right now, insiders own 39.4% of the total outstanding shares. On March 05, the CFO and treasurer of the company, Kim Paul, bought 100,000 shares for a total value of $1,596,470....

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